The AUD/USD pair had a very strong session on Friday, reaching towards the highs that we had touched on Thursday. That’s a very bullish sign, and I think that the market is now trying to reach towards the 0.75 level above. Gold markets have been strong, and that of course helps the Australian dollars well. I think that the market pulling back from here should be a nice buying opportunity, and waiting for a supportive candle would be the best way to go on dips as they represent value in a currency that I think is probably a bit undervalued currently. The market should continue to be choppy and volatile, but I think the 0.74 level underneath should continue to be supportive, as it has shown itself to be resilient over the last 5 sessions.
Buying the dips, dealing with the volatility
I think the only way to trade this market is to buy the dips as they occur, and then just simply deal with the volatility that will almost undoubtedly come with this market. Alternately, I believe that the 0.75 level is significant, but if we can break above there the market should continue to go even higher, perhaps reaching towards the longer-term target of 0.7750, which of course will take some time to get to. With that in mind, my longer-term vision of course is to the upside, so I don’t have any interest in selling but I recognize that there will be times where it’s very painful and difficult to hang on to the Aussie dollar. The past week has been enlightening, as it shows just how resilient the Aussie buyers are, and I think that should continue to be the case going forward unless of course the gold markets selloff drastically.
Written by FX Empire