AUD/USD holds just under 0.69 but is once again meeting the familiar resistance level in the form of the 200-day moving average
The aussie is still building on some decent momentum after the better-than-expected jobs report yesterday against the dollar but as it runs into familiar territory once again, will we see a repeat of the same story we have seen all throughout 2019?
The 200-day MA (blue line) has been a key level in limiting the upside momentum in the pair throughout the year and buyers have not managed to secure a daily close above the pivotal level since March 2018.
That makes the level a key point of interest and with that level sitting at 0.6905 today, it may well be what helps to limit gains in AUD/USD once again.
The only caveat is that the test of the level comes during a period where traders may not be too bothered with i.e. year-end trading. Liquidity conditions are thin so I would still ascribe any break to be a bit suspect as they may not be reflective of real market flows.
But looking ahead, there is good reason to still look towards the level as being a key area where sellers may potentially lean on. I've talked many a time that AUD/USD is largely a trade on yield differentials as seen here:
And with the RBA set to be more likely to cut rates than the Fed next year, it could help to push the yield differential more in favour of the dollar in the medium-term outlook.
