The Australian dollar is poised to correct its recent downtrend in our view
A brand new week for trading and we are embarking on our daily forecast to track the movement in the AUD/USD pair. At this point in time, as price is trading around 0.9079 we are inclined towards buying calls around 0.9075. Only a break below daily lows at 0.9070 on a sustained hourly basis would reverse our call at this stage.
Last Friday proved to be a screamer, with volatility across binary options forex markets going bonkers. Following the better than expected non-farm payroll numbers the US dollar staged a big rally across the board, only to find brand new sellers to hit it back on the premises that while the data is strong, its not so strong as to guarantee the FED reducing stimulus.
The Australian dollar took cue from the moves and quickly fell to a weekly low at 0.8990. Subsequently as the dollar was selling off the pair ended the session close to its highs for the day at 0.9100.
Today early Asian markets while boosted by news out of China over the weekend that reported better than expected trade data pointing to a prolonged recovery in sentiment, the Australian dollar reached highs around 0.9129. As European trading was about to kick off, the effect of the data waned and the pair was sold off to 0.9070.
If we want to make a guess where is the next level, for now we would be tilted towards the upside. After all if the strong non-farm payroll number couldn’t lift the US dollar up, what could? We are buying calls around the 0.9070-5 area on an hourly basis and maintain caution if the pair brakes below 0.9060 on a sustained hourly close.