The AUD/USD pair initially spiked during the session on Thursday as the “hopium rally” started back up. The market looks as if it expected that the Fed Chairman would start to talk about easing during his testimony before Congress, and when he didn’t suggest it was coming, we saw a deterioration of risk appetite in general.
This of course works against the Aussie dollar, and as a result this pair pulled back to form a shooting star. More importantly, it did so just under the parity level, and it now looks that the downtrend is going to continue. We are selling a break of the lows for Thursday, and would aim for the recent lows, if not lower.
Written by FX Empire