Resuming trading at the beginning of this week, investors are still on high alert following concerns that continue to plague the market following the global bank collapse crisis.
Although a little eased by the actions and plans announced by certain parties, the feeling of fear and panic in the market still lingers.
Credit Suisse has reportedly been bought by UBS for $3.2 billion and the move has also received support from the government to maintain investor confidence.
Most recently, it was reported earlier this week regarding a joint plan by several major central banks including the Federal Reserve (Fed), the European Central Bank (ECB) and the Swiss National Bank (SNB) in an effort to stimulate the flow of US dollars in the global financial system.
While the panic in the market eased a bit at the end of last week, the US dollar was seen to be moving weakly and other major currencies took advantage of the opportunity to strengthen including the Australian dollar.
If you look at the price chart of the AUD/USD pair last week, the price managed to rise again at the end of the week after initially experiencing a decline.
After dropping to around 0.66000, the price managed to rise again above the 0.67000 level at the end of the week.
And continuing trading at the beginning of this week, the price is still hovering around 0.67000 and is above the Moving Average 50 (MA50) support level on the movement in the 1-hour time frame on the AUD/USD chart.
If the bullish pattern continues this week, the price increase is seen to head towards around 0.67700 or 0.68300 before reaching the 0.69000 resistance zone.
The recent highs will continue to be recorded if the situation does not change and the US dollar remains weak in the market.
However, any surprises could happen as trading heads into the FOMC meeting early Thursday.
If the US dollar manages to strengthen and push prices down again, investors should be prepared to watch for signs of a trend change.
The price drop will return to the main support zone at 0.65700-0.65400 before the price reaction in the zone will signal further movement.
