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MENAFN- Daily Forex)
The Australian dollar has fallen rather hard during the early hours on Tuesday, as the market had initially tried to break above the 50 Day EMA at the end of last week, and now we have seen this market really fall apart. This makes quite a bit of sense, because this is a market that has been negative for some time, so any time it rallies, one would have to assume that sooner or later there would be plenty of people out there willing to short the Aussie.
Technical Analysis
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The technical analysis is very negative at this point in time, as we initially tried to rally and break above the 50 Day EMA but then gave back gains almost immediately. At this point, it looks like the market could go looking to the 0.62 level, an area that of course is a large, round, psychologically significant figure, and an area that has previously offered a bit of support. Anything below could open up a move down to the 0.6150 level. Underneath that level, the market is likely to go looking at the 0.60 level, which I do think is a destination.
On the other hand, if we do turn around and rally, the first resistance barrier is the 50 Day EMA, followed by the 0.6350 level. If we get above there, then I think the Australian dollar could turn things around. I think ultimately, this is a market that will continue to move based on the Chinese data, which of course has been weaker as of late, and despite the fact that the AUD/USD market has been strong for the Australian dollar until the last 2 trading session, when you look at the longer-term trend, it is most certainly negative, and I just don't see anything at this point in time that will change that. However, keep in mind that the Federal Reserve has a major interest rate decision coming out on Wednesday, so that will obviously cause a lot of volatility.
EURUSD Chart by TradingView
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