The Australian dollar has been very noisy during the trading session on Tuesday, as we continue to pound to the downside. It looks as if we are going to try to break down below the 0.76 handle, and if we can do that, it’s likely that the market will continue to go much lower with the first level of interest being the 0.75 level underneath, which of course is supportive. It’s a large, round, psychologically significant handle, and with that being the case it’s likely that the market will be very noisy and that level. If we can break down below there, and I think we will, it’s likely that the market should then go down to the 0.7350 level after that. The markets continue to be very noisy, but quite frankly I don’t think that the Australian dollar will hold any type of support for a significant amount of time.
Gold markets need to help the Australian dollar, because quite frankly I don’t see a reason for it to go higher without some type of major bullish pressure. There is trouble with the US Congress trying to pass tax reform, but quite frankly the Australian dollar is much more tied to Asia, and although we continue to be noisy, I prefer to sell rallies every time we get some type of exhaustion. If we can break above the 0.77 handle, then I think we go higher, perhaps reaching towards the 0.78 level above. However, there is a lot of noise and it’s going to make trying to go to the upside very difficult. I think that short-term trading is about the only thing you can do, and you need to approach the market as such. If you do not have the ability to sit at the computer, it’s difficult to trade this market.
Written by FX Empire