AUD seems to be waiting for something
We’re looking at two days of holding a very tight range and that usually means we’re waiting for something to give.
There’s two things the aussie is hanging on for. 1. Good news from the US/China trade talks. 2. Possible further support/impact from the PBOC easing. Both cases revolve around China and are very much interlinked. Obviously commodity pricing is in the mix too. The 30 pips range above is too tight to stay that way for long but it seems that we’re going to need a headline or driver to decide which way it goes. If we don’t get any news then the market will make the decision anyway because that range is too tight. That might only mean we move into another 30 pip range for a while.
Traffic still looks heavy into and through 0.7200 but any big positive headlines will probably pop that with ease.
To the downside, 0.7100/10 will need to hold decent enough support to keep the rally in play, or else we could have a quick trip down to 0.7040, which once again is likely to hold support once more.
One thing I do know about this pair is that at times, it can make you work hard for your pips, whichever way you trade it. Ordinarily, with a tight range like this running for so long, I’d perhaps look to go with a break but I know from experience that this PA will likely see it just shift into another tight range, leaving one sweating on a trade.