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The Australian dollar initially fell during the course of the session on Friday, but turned around to form a hammer. The hammer of course is a very bullish sign, and a break above the top of the hammer of course means that the market will probably try to reach towards the top of the consolidation area again. We look at this chart, it’s not too difficult to notice that there is a general uptrend and it now appears that we are trying to reach towards the 0.7750 level above, which is massively resistive. A break above there should be rather bullish, and perhaps could send the Australian dollar to the 0.80 level above. With fact, I believe that this market will continue to offer buying opportunities every time it pulls back as I have been saying for some time, and this candle for the Friday session only reinforces that opinion of mine. Adding more gravitas to this move is the fact that the gold markets did rally during the day on Friday, and that of course there is a strong correlation between the gold market and the Australian dollar. With this in mind, I remain very optimistic.
