The AUD/USD pair initially went sideways during the day on Friday, but didn’t the bit to find support near the 0.7950 level. We then slammed into the 0.80 level above, which is a psychologically important level, and of course an area that has been important on charts going back decades. I believe that we continue to find buyers, especially as gold has been so bullish. The Australian dollar is a proxy for gold markets by currency traders, as Australia is the largest exporter of gold in the world. I believe that the market should continue to go towards the 0.8050 level, and then eventually the 0.82 handle. I have no interest in shorting the gold markets, because quite frankly they look so bullish. Ultimately, this is a market that is essentially a “buy only” market.
I continue to buy dips in this market and I believe that there is plenty of support near the 0.7950 level underneath. Even if we break down below there, I believe there is more than enough support near the 0.79 handle after that. Given enough time, the markets should continue to find bullish pressure but obviously we have been in a downtrend for a very long time, so will take a significant amount of work to finally break out to the upside and continue higher on the longer-term time frames. And the short-term, it simply a matter of buying dips and hanging on.
Written by FX Empire