Chart of the day: Australian dollar gathering momentum
On Friday morning, Reserve Bank of Australia’s deputy governor Guy Debelle said: “Just as the policy rate in Australia did not need to decline to the very low levels seen in other parts of the world, the fact that other central banks increase their policy rates does not automatically mean that the policy rate here needs to increase.” The Australian dollar, which had already broken above triangle consolidation in the previous week, pared some of its gains, balking at the psychological level of 80 US cents. The break is significant, as is last week’s close above first retracement resistance at 78.5 US cents. Futures volume has been dropping this year, suggesting many will have to catch up. The first target is 81.65 US cents.
Nicole Elliott is a technical analyst