Aussie Resumes Impulsive Weakness Into Wave C
Gregor Horvat | May 25, 2023 04:51AM ET
Following a recent decline in US stock markets, the US Dollar Index Futures is showing signs of strength, with DXY trading at a new high. Fitch Ratings has placed the United States' AAA rating on a negative rating watch due to concerns regarding the debt ceiling negotiations.
Fitch Ratings suggests that these negotiations have increased risk of the government potentially defaulting on certain financial obligations, so speculators sold stocks especially as a lot of investors will not take a risk and hold stocks through long weekend. Keep in mind that there is a holiday on Monday in US and some EU countries as well. This can trigger more weakness going into the end of the week, so USD can stay strong. Looking at the AUD/USD chart, we see nice ongoing weakness, now headed down for wave C which has room for further drop until five waves down from 0.680 are done.
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