The Australian dollar appreciated a bit in Thursday’s trading session to cross the 0.76 mark. It’s a currency that has been working pretty well for quite some time now, so it looks like the next higher stage is starting. This coincides with the hammering of the US dollar in general, so it makes sense that we are going higher. The Aussie is moving primarily on the idea of a relaunch, and it looks like the Americans are getting closer to that. The idea is that this will devalue the US dollar and drive up demand for commodities. Obviously, if you have been trading Forex for more than 15 minutes or so, you know that the Australian dollar is strongly linked to various commodities such as gold, copper, and iron.
AUD / USD Video 18.12.20
The size of the candlestick suggests that the market wants to go higher so I think it’s only a matter of time before we see bought pullbacks. The 0.75 level should now offer a significant level of support, as it is a large, round, psychologically significant number and of course an area that had previously been subject to resistance. “Market memory” suggests he should do the same, so at this point I think it’s only a matter of time before it goes up. The 0.7750 level is the longer term goal, and maybe even the 0.80 level. At this point, it just comes down to the scale of the stimulus in the United States and whether or not it is triggering some kind of “risky” environment.
For an overview of all of today’s economic events, check out our economic calendar.