Australian Dollar Breaks AUD/USD and Crosses, But Follow Through?
• AUDUSD was just one of a range of the Aussie Dollar crosses that forced favorable breaks this past session
• The technical break is clean and there was fundamental motivation, but does that support follow through?
• Market conditions are favorable for breaks, but trends are difficult to muster without steady fundamentals
See how retail traders are positioning in the majors in your charts using the FXCM SSI snapshot.
After months of congestion and false starts of volatility, AUD/USD printed a convincing bullish wedge break. This wasn't the only Aussie Dollar pair that offered an impressive technical move Tuesday. There was remarkable progress and key levels surpassed with EURAUD, AUDJPY, GBPAUD and AUDCAD. The breadth of the move is certainly convincing, and the motivation for the Aussie bid was well founded in event risk. The RBA decision over-rode a range of conflicting data from Australia and China to suggest the currency is balancing out with a neutral monetary policy standing. Yet, is 'neutral' enough to carry the currency to a lasting trend? General market conditions are conducive to volatility but not necessarily a steady trend. Fundamentally, the event risk behind us has limited reach; but there is another round today. We focus on the Australian Dollar and its trade potential given remarkable volatility in today's Strategy Video.
Sign up for John’s email distribution list, here.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.