The Aussie dollar pulled back slightly during the trading session on Tuesday to show signs of hesitation again, as we are waiting for the Federal Reserve announcement at the end of the day Wednesday. The market looks as if the 0.76 level underneath should continue to offer support, especially with the 200 day EMA approaching that. On the other hand, if we reach to the upside, it is likely that the 0.7750 level. Looking at this chart, I think we are essentially slumping slightly to the downside. If we did break down below the 200 day EMA, then it is likely that we continue to break down quite a bit, and quite frankly there is a lot of questioning right now as to where the dollar goes next.
AUD/USD Video 16.06.21
While inflation is a concern, the reality is that money seems to be flowing into the bond market, which is a bit counterintuitive. If that is going to be the case, then the market could drift down towards the 0.70 level….