Australian Dollar Overtaking Previous High

Australian Dollar Overtaking Previous High

The Australian dollar initially pulled back just a bit during the trading session on Tuesday before shooting straight up in the air. We are threatening the previous high, near the 0.7440 level. This is an area that the market has previously seen as important, so now that we are peaking above it, it does suggest that we are going to go looking towards the 0.75 handle given enough time. That does not mean that it will be easy, just that the market is likely to get there eventually.

Looking at the size of the candlestick, it is rather impressive when compared to the previous candlestick, showing that we are starting to pick up momentum again. That being said, the 0.75 level is going to be difficult, and therefore I think we probably have to spend some time building up momentum. If and when we can finally break above there, the market could become more of a “buy-and-hold” scenario, but until then I think it is probably a scenario where you have to be somewhat cautious.