It was one other inexperienced open to the week and as soon as once more there appears to be no stopping the bull run in danger property such beca
It was one other inexperienced open to the week and as soon as once more there appears to be no stopping the bull run in danger property such because the AUD/USD.
The Aussie has been in breakout mode and has rallied off lows of 0.5500 to be again above the 0.7000 degree. This can be a large bounce to say the least and I feel it’s honest to name this a ‘V-shaped’ rally.
One of many current developments that has been large for the Aussie has been the rise in some key commodity costs. Everyone knows that GOLD has been robust in current months and worth remains to be across the $1700 degree. Nonetheless, it has been iron ore that’s grabbing headlines regionally.
The value of iron ore is above US$100 per tonne and is being boosted by a COVID-19 outbreak in Brazil. Brazil is a rival exporter of iron ore and their predominant provide has been lower. The identical kind of factor occurred final yr when there was the mine collapse. This led to an enormous rally within the worth or iron ore which is a serious export for Australia.
So whereas 0.7000 might sound excessive in the meanwhile, there’s a fundamentals cause, as costs of commodities proceed to surge greater and danger is again in favour.
No Finish in Sight for the AUD/USD?
Trying once more to the charts, we are able to see that there will probably be a little bit of resistance round this degree and I nonetheless wouldn’t be stunned to see this rally lose steam on this space.
US shares have regained their 2020 highs on the similar time and for me, this may be a possibility for shares to tug again and/or consolidate a bit. However stranger issues have occurred.
So for now, we watch this 0.7000 degree and see if worth can maintain. This can be a very powerful brief to make, however I feel that is the plain space for revenue taking for many who have held by way of this large rally.
