The Australian dollar fell a bit during the week, crashing into the 0.7050 level, which is an area that has shown rather significant support. Beyond that, we have massive support near the 0.70 level that extends down to the 0.68 handle. In other words, I think what the longer-term trader is going to look for is going to be some type of supportive candle stick just below to start getting long again. The daily chart does suggest a short-term bounce, but the longer-term chart suggests that maybe we need to find buyers in this area. We are still finding a lot of bearish pressure, but I am still focusing on that massive hammer which is at an area that has been important on monthly charts.
AUD/USD Video 11.02.19
In other words, I think you need to be looking for value and you are going to need to show some signs of wherewithal to be able to hang on to what should be a very uncomfortable position. However, this is an area that has been important for so long that it makes a lot of sense that longer-term traders are looking to get involved. Institutions are buying the Australian dollar based upon longer-term need, as they do not look at the next couple of hours. That hammer that formed about five weeks ago is so bullish that I continue to pay attention to it. I believe that the 0.7250 level above is massive resistance, so it’s going to take work to get above there. Once we do, the market could run to the 0.75 handle. I would start out very slow.
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This article was originally posted on FX Empire
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