AUD / USD Video 05.06.20
The Australian dollar has seen a huge upward movement and therefore we are now paying attention to the US-China trade situation which is getting a bit worse. We haven’t really reached the breaking point yet, but it looks like the tensions aren’t necessarily going away.
The Aussie dollar has been rising sharply for quite some time, so a little bit of reality might be just what this pair needs. After all, things can’t go in one direction forever and the higher we go in a short time frame like this, the wilder the hindsight will be. This setback will likely be quick and brutal, and when it does, everyone will be in great pain. It doesn’t necessarily mean you can just step in and start randomly shorting out, but it does mean we’ve got a head start on ourselves.
That being said, if the pair breaks above the 0.70 level, it is likely that we will see another wave of buying, and what would likely be seen as a potential “breakout”. Frankly, a lot of this trade rests on the hope that the world economy will return to normal, which seems highly unlikely anytime soon. However, the price is what it is, and therefore we envision a market that just won’t come back. Once it does, it will be very violent.
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