The Australian dollar has initially tried to rally during the trading session on Monday, only to turn around and show weakness again. Ultimately, this is a market that looks very likely to continue to see a lot of noise around it as the Australian dollar is so sensitive to the US/China trade situation. Ultimately, I think that the market will continue to be very noisy as the nonsense between the leaders continue. There was initially reports that it was a “very constructive” phone call between the Americans and the Chinese over the weekend, only to have “unnamed officials” suggesting that they were very “pessimistic” about the phase 1 deal. In other words, it’s all noise, nonsense and gamesmanship.
AUD/USD Video 19.11.19
Unfortunately for Australia, it is heavily influenced by what’s going on between the Americans and the Chinese, and therefore it’s currency will be held hostage. All things being equal, this is a market that should continue to show a potential bottoming pattern, and if we can finally get some type of good news coming out of the trade situation that can actually stick, this market will reverse immediately. We are making “higher lows”, so that is in theory a good sign but unfortunately market participants will continue to be thrown around by the latest headline.
If we can break above the wipeout candle from Thursday, that would be a very good sign. If we were to break down below that candle, then it’s likely that the market goes looking towards the 0.67 level underneath. Unfortunately, though, he will have to keep your newsfeed open in order to figure out what happens next.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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