AUDUSD Big Level on Watch
Heavy risk aversion as we kick off the new week has seen commodity-linked currencies getting hit hard. Chief among them is the Aussie which has broken down through last week’s lows and is now once again testing 2022 lows around the .6989 level. This is a major support level for the Aussie, currently being tested for the third time. Worth taking a look at shorts on a breach of the level targeting a move down to .6833 initially. This will be a heavily bearish technical development, likely opening the way for a much deeper move towards .6681 thereafter. Retail market around 70% short, so plenty of room for this move to develop further as we break lows.
Keep an Eye On
Current dynamics of stronger USD and weaker risk-prices is keeping AUDUSD well-pressured here. While this narrative continues, current downtrend to stay intact. However, if we start to see any pull back in USD, and a bounce in equities, this will change. With this in mind, keep an eye on US inflation this week. Any undershooting of estimates might weaken USD a little. If inflation hits or beats targets, however, expected USD strength to continue.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.