The Australian dollar has rallied a bit during the trading session on Monday, breaking above the 0.69 level before pulling back a bit. However, this is a market that is trying to break out, and if we can clear the top of the range for the trading session on Monday, this market is very likely to continue going towards the 0.70 area, perhaps even higher than that. The Australian dollar has been trying to turn things around, making “higher lows” as we go along.
AUD/USD Video 14.01.20
That’s a good sign, but that doesn’t necessarily mean that it’s can it be easy to trade this market going forward. Remember, if we do continue to go higher, that means that there is a trend change in the works, but those are almost always very messy affairs. If that’s going to be the case, it’s very likely that the market will struggle going forward, but I still believe in the upward momentum. If we get more of a “risk on” type of move, it’s very likely that the Australian dollar will continue to be a beneficiary, especially considering that the United States and China are getting ready to sign a “phase 1 deal.” Ultimately, Australia will be one of the bigger beneficiaries from the situation, especially if the Chinese economy can continue to accelerate. If it does not, that could weigh upon the Aussie but from historical standpoint we are at very low levels and therefore it’s much more likely to go higher than lower at this point.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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