Aussie Holds Below Key Resistance- Risk Appetite to Dictate Trade

Fundamental Forecast for Australian Dollar: Bearish

Australian Dollar Consolidates at 200 day AverageAUD/NZD Risk Neutral Short Scalp- A Play on Rate ExpectationsAUD/USD Classical Technical Report 08.12

In an unprecedented volatile week in financial markets, massive swings in risk sentient witnessed the rise and fall of global equity markets as investors reacted to a host of economic concerns. The Australian dollar plummeted as sharp sell-offs around the world saw traders jettison so called “risk currencies” in favor of haven plays into the swissie, the yen, and the dollar. However a rebound in stocks during the later part of the week saw the Aussie pare some of the steep declines on renewed hope that the Fed’s extended zero rate policy will avert a slide back into recession and that European leaders will be able to find consensus on a way to stem further contagion of the debt crisis that has sapped confidence in the region.

The Aussie fell 0.9% against the greenback this week, with the antipodean currency plummeting nearly 3% against the yen as investors shunned risk after rating agency Standard and Poor’s downgraded the US debt rating from the coveted AAA to AA