MasterForex: The Australian dollar will rise further, and waiting for a pullback is needed for going long on the Canadian dollar - Foreign Exchange Simulation Trading Account

by master0722 on 2011-08-15 21:58:45

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During the Asian session today, non-US currencies continued their upward trend from last Friday. Overall, the market has largely absorbed the impact of S&P's downgrade of the US credit rating. As time goes on, the market focus has shifted towards the European debt crisis. Additionally, this week both the Reserve Bank of Australia and the Bank of England will release the minutes of their August meetings. The descriptions regarding inflation and economic growth in these minutes will influence the trends of the aforementioned two currencies.

Last week, Europe’s ban on short selling financial stocks provided some relief to market risk sentiment. However, the ban is temporary, and it is unlikely that France and Germany will reach a milestone agreement on the 16th. Therefore, it is expected that the euro will continue to be mainly driven by volatile consolidation in the near future.

US Dollar/Canadian Dollar:

With the dramatic fluctuations in crude oil prices, the Canadian dollar's movements have also been unstable. In the current context, concerns over the Eurozone debt crisis make it seem unlikely for crude oil prices to sustain an upward trend, thus the outlook for the Canadian dollar is not optimistic. From a technical chart perspective, the USD/CAD was highly volatile last week due to the influence of risk sentiment. It has now returned below the key psychological level of 0.99. Personally, I believe that the Canadian dollar is unlikely to directly break through the parity level and may experience a pullback in the near term. Support lies around 0.98. If there is effective support between 0.98-0.977, investors are advised to consider entering long positions on USD/CAD.

Australian Dollar/US Dollar:

On Friday last week, the AUD/USD exchange rate rose slightly. Overall, the Australian dollar was significantly influenced by news last week. It broke out of its previous consolidation range, and technically speaking, the Australian dollar still has potential for further appreciation. However, fundamentally, there is some uncertainty, especially as global economic slowdown concerns could put pressure on the Australian dollar. Currently, resistance for the Australian dollar is around 1.05. Investors are advised to consider entering long positions on the Australian dollar after a pullback for short-term gains.

Gold:

After reaching a new historical high of $1813.79 on Thursday, international gold prices retreated, aligning with our expectations. Resistance levels are near $1750 and $1720. After hitting a low of $1723 on Friday, gold rebounded. Investors who opened positions at lower levels can consider reducing half their positions around $1550 and observe subsequent price movements. Last Thursday, better-than-expected US employment data, along with announcements from the three major rating agencies that they would not downgrade France's credit rating in the near term, alleviated some risk aversion sentiments, leading to this round of gold correction.

From a technical perspective, although gold prices did indeed correct, the overall uptrend remains very clear. Considering that risk aversion sentiments in the market still exist, and as we approach the fourth quarter, physical demand for gold might drive prices to new highs. Thus, personally, I remain optimistic about the future prospects of gold. Especially since the Eurozone debt crisis still lacks a clear solution, the outlook for gold is bright. Investors are advised to consider buying gold in batches around $1720, as the future prospects for gold are very promising.

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