Australian Dollar Moves Lower As Commodity Prices Fall

Commodities are down sharply, with oil down over $2, Copper down 4.05, the Commodity Research Bureau Index (a measure of commodity direction) is down by 4.20 today.  This has led to a selling of the commodity currencies such as the AUD and the Canadian dollar.

The AUD/USD broke through key support at the 0.6927 level earlier in the day and moved lower.  In the last hour the pair flushed lower after breaking the 200 hour moving average at the 0.6884.  The price moved to a low of 0.6864 before rebounding.   Nevertheless, the bias remains to the downside as some skepticism at the economic rebound start to enter the market.

The target level on the downside comes in initially at the 0.6842 level.  Below that is the 38.2% retracement of the March move higher.  That level comes in at the 0.6785 area.  Look for resistance at 0.6902.  A move above the 0.6927-0.6939 level would indicate something is amiss with the downward bias.

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