On November 3rd, I discussed how AUDUSD was breaking through a key resistance level.
The level in question was a trend line that extends from the year-to-date high.
AUDUSD cleared that level on November 3rd.
After a 160 pip rally, where is AUDUSD likely to go from here?
While it may be an unpopular opinion, I think the Australian dollar has every chance of testing the 0.8100 area as we head into 2021.
I made a similar comment about NZDUSD and 0.7500 in Saturday’s forecast.
However, that doesn’t mean there won’t be pullbacks along the way.
If AUDUSD is going to push higher, I’d like to see the 0.7230 area hold as support on a daily closing basis.
But even if 0.7230 fails, it doesn’t mean the AUDUSD rally is over.
As I mentioned a few weeks ago, the 0.7020 area is the one that needs to hold going forward.
As long as 0.7020 holds, the uptrend is intact.
And as for key resistance, I’d expect sellers to defend the year-to-date high near 0.7400.
Get above that on a daily closing basis, and we could see AUDUSD trend higher toward 0.7760 and eventually 0.8100.