FxWirePro: Aussie faces key resistance at 0.75 area

The outlook for Australian dollar remains clouded with uncertainties. Strong fundamentals are in place, some of which favors the bulls, while the others favor the bears. For example, the rally in metal prices, especially in iron ore, remains positive for Aussie, while the strength of the dollar remains a big liability. The recovery in sectors other than mining is helping the Australian economy to steer through the commodity bust, while the renewed weakness in the Chinese economy largely threatens both metals prices and Australian exports to the country.

While Bears are looking to push the currency towards 0.64 area against the dollar, the bulls have aimed 0.81 area. In our previous call, we sided with the bulls; however, the strength of the dollar post-US election forced us to retreat.

After bottoming at 0.716, the Australian dollar is currently trading at 0.75 against the dollar and is at a very important resistance. We recommend our readers to watch cautiously for confirmation before any jump.