The US dollar has gone back and forth during the trading session on Wednesday in reaction to the election results, which have been erratic to say the least. Longer-term, we are most certainly in and uptrend and I do think that there is a lot of support underneath. The uptrend line is underneath marked on the chart, and the ¥112 level also offers a lot of support, and I think at this point a pull back to that area should be a nice buying opportunity. If we do break down below the uptrend line, then I think we could go much lower. I think that the ¥114.50 level above is massive resistance, extending to the ¥115 level. Right now, we are basically right in the middle of this area, so I don’t see much of a trade at this particular level.
The Australian dollar initially fell during the trading session on Wednesday, but then turned around to break above the 0.7250 level, and more importantly broke above a downtrend line. I think at this point we could see buyers reenter this market, but I also recognize that all it would take is a headline involving the US/China trade situation that is somewhat negative to turn this market right back around. I think at this point it’s likely that the markets are at least trying to change things, but the 200 day moving average is just above as well, so although I would be willing to buy a pullback that show signs of support at the 0.7250 level, I would keep my position small because these type of trend reversals can often be very noisy. If we break down below the 0.7225 handle, then I think we probably go down to the 0.70 level again.
This article provided by NewsEdge.