The Australian dollar has pulled back a bit during the trading session on Wednesday but found support underneath the 50 day EMA to rally yet again. That being the case, the market looks likely to go higher based upon the fact that the market is starting to price and the idea of a “phase 1” deal being signed. After all, the US/China trade relations have a major influence on the Australian dollar, as Australia is a major contributor of raw materials to the Chinese mainland, both for exports and construction.
AUD/USD Video 21.11.19
To the downside, it looks as if the 0.6775 level underneath looks to be supportive as it was resistance in the past, and it should be noted that we are starting to form “higher lows”, and have also formed a “double bottom” not only over the last couple of days, but going back several months as well on a higher time frame. The 200 day EMA above is starting to reach towards price, so it’ll be interesting to see whether or not it reacts as a “ceiling” in the market. If the market turns around and rallies and eventually breaks above the 200 day EMA, then the market should go much higher. What should also be noted though is that the most recent high broke significant resistance but did struggle at the 61.8% Fibonacci retracement level. All things being equal though, I think it’s only a matter of time before we do eventually break out.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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