By FX Empire.com
AUD/USD rose on Thursday, as it continues to defy gravity. The pair looks overly bullish, but is slowing down the acceleration as it enters the 1.02 – 1.03 resistance area. This move has been parabolic, and these types of moves normally end poorly when they are counter trend, such as this one. The biggest issue with this rally is that it is based upon the idea that Europe might agree to do something about their situation, but the biggest issue is that they haven’t actually come up with a plan. Until they do, there is considerable risk to the downside in all risk-related assets.
With this in mind, we are not buying this pair presently and are looking for weakness to signal a selling opportunity. Until we get it, we will be on the sidelines as this market will certainly struggle over the next 100 or so pips anyway.
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