Australia dollar fights on

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The Australian dollar has fought back pretty well this week given the domestic economic data. In truth, though, it probably didn’t fight at all – it’s just a boat that has been lifted by the tide as Greece nears a deal, and default is forestalled once more.

But, we could have expected the dollar to be weaker still.

As you can see in the chart below, the Australian dollar broke down through the uptrend line, ran a little, and re-tested the line overnight:

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Where to now?

It’s looking more like a range than a crash/fall. The re-test of the line, if it fails, suggests back toward 1.05 for a re-test of the bottom. My double Bolly strategy is still short, just, but is in the money.

Time will tell on this one.

Gregory McKenna
www.twitter.com/gregorymckenna

Usual disclaimer – this is not advice, I haven’t taken your circumstances into account and I have my own stops and money management tools you don’t have access to.

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