The Australian dollar rallied again during Thursday’s trading session to hit the crucial 0.73 level. This is of course an area that many people will pay attention to, as we have seen this be important on several occasions over the past few days. Additionally, the 50 day EMA is trending towards this area as well, so this is another reason from a technical analysis perspective that suggests we should have some selling pressure pretty soon. The market break above the 50-day EMA would of course attract some attention.
AUD / USD Video 08.10.21
On this move above the 50 day EMA, it is likely that the market will turn towards the handle of 0.74, an area that was the top of the overall range in which the market had previously been involved, therefore I think it’s really only when we break above this area that the market is likely to keep going up. With that in mind, I think it also makes perfect sense that we weren’t going anywhere by Friday, due to the fact that the non-farm payroll announcement is being released during this session, and it the markets will more than likely continue on edge by then.
Keep in mind that Australia relies heavily on China which, of course, puts a fair amount of external pressure on it. The Chinese situation right now is precarious at best, so it will be interesting to see how that plays out over the next few weeks, and therefore, I think we probably still have a significant number of downside possibilities.
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