Australian dollar continues to find resistance

Home » Forex News » Australian dollar continues to find resistance

The Australian dollar rallied a bit during the day on Friday but continues to find resistance in the same area. With this being the case it’s obvious that we are in a major consolidation area that should continue to attract attention in both directions. Ultimately, the market has been in a relatively negative attitude until the last several days, which have shown the market to be consolidating the gains for the greenback.

The importance of 0.68

AUD/USD

The importance of the 0.68 level is obvious when you look at the daily chart. This is an area that has offered resistance over the last several days, and it looks as if it’s going to continue to do so. We had recently formed a hammer on the breakdown, and then have since stabilized in this area. As we have pulled back several times from the 0.68 level, it makes that area obvious resistance that should be paid attention to.

Having said that, there’s also significant resistance building at the 0.69 level as well, and now the 50 day EMA is sitting in the same neighborhood. That should also cause a lot of resistance if you could see the market break above the 0.68 which admittedly is an extremely low level. However, there are a world of factors working against the Australian dollar, and of course favoring the US dollar.

External factors

There are a handful of external factors messing with the Australian dollar, as the Aussie dollar is highly sensitive to all things Asian. With that being the case, the US/China trade situation continues to be a major sticking point for the Australian dollar, and therefore I think that it’s very likely that any rallies will continue to cause selling opportunities as the US dollar is favored. Speaking of the US dollar, but most of the world desperately needs US dollars to pay debts and purchase commodities, and as there is a shortage it will continue to command a premium. Beyond that, the US Treasury markets have been on fire as of late, attracting massive flows across borders. This is a bit of a perfect scenario for this pair to continue to go lower.

The trade going forward

The trade going forward in this pair is relatively simple. I’m a seller of the Australian dollar but the question is whether or not the 0.68 will hold. I’m willing to sell now, but I recognize that if we were to break above the 0.6825 handle, then we may need to “reset” above closer to the 0.69 level where I would do the same thing up there as well. To the downside I expect to see the hammer tested from a couple of weeks ago, and then down to the 0.65 level underneath which is a major support barrier on the monthly chart. I do believe that we are going to test that level given enough time, because quite frankly that situation between the Americans and the Chinese is only getting worse at this point.

Leave a Reply

Your email address will not be published. Required fields are marked *

Top 5 Forex Brokers

✅ Accounts: $15k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 5%, 10%

✅ Accounts: $5k - $200k
✅Profit Split: 80% - 90%
✅ Profit Targets: 10% (1-step), 10%/5% (2-step)

✅ Accounts: $6K - $200K
✅ Profit Split: 100%
✅ Profit Targets: 8% (Phase 1), 5% (Phase 2)

✅ Accounts: $5k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 9%, 5%

✅ 24/7 Customer Support
✅ Low Minimum Deposit
✅ Many Trading Instruments Available
✅ Easy-to-navigate Platform

✅ Daily Payouts
✅ Free Trial Conversion
✅ No Trailing Drawdown
✅ Funded Traders A-Booked

Top Platform in 2024

✅ Accounts: $15k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 5%, 10%

✅ Accounts: $5k - $200k
✅Profit Split: 80% - 90%
✅ Profit Targets: 10% (1-step), 10%/5% (2-step)

✅ Accounts: $6K - $200K
✅ Profit Split: 100%
✅ Profit Targets: 8% (Phase 1), 5% (Phase 2)

✅ Accounts: $5k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 9%, 5%

✅ 24/7 Customer Support
✅ Low Minimum Deposit
✅ Many Trading Instruments Available
✅ Easy-to-navigate Platform

✅ Daily Payouts
✅ Free Trial Conversion
✅ No Trailing Drawdown
✅ Funded Traders A-Booked

Top Prop Firm in 2024

✅ Accounts: $15k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 5%, 10%

✅ Accounts: $5k - $200k
✅Profit Split: 80% - 90%
✅ Profit Targets: 10% (1-step), 10%/5% (2-step)

✅ Accounts: $6K - $200K
✅ Profit Split: 100%
✅ Profit Targets: 8% (Phase 1), 5% (Phase 2)

✅ Accounts: $5k - $200K
✅ Profit Split: 90%
✅ Profit Targets: 8%, 9%, 5%

✅ 24/7 Customer Support
✅ Low Minimum Deposit
✅ Many Trading Instruments Available
✅ Easy-to-navigate Platform

✅ Daily Payouts
✅ Free Trial Conversion
✅ No Trailing Drawdown
✅ Funded Traders A-Booked