AUD/USD Forecast – Aussie Continues to Look Weak -

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has firmly broken down below the 0.6450 level, an area that previously has been a major support level. All things being equal, this is a market that sees a lot of noise underneath, and therefore I think the downside is probably somewhat limited in the short term, but I do think at this point in time, you’re probably going to be looking at the idea of fading rallies at the first signs of exhaustion. All things being equal, this is a market that will be very closely related to risk appetite.

After all, the Australian dollar is considered to be a commodity currency and therefore it is something that a lot of people will run to when it’s time to take on risk and run from when the opposite occurs. The US dollar of course is a safety currency so that’s also worth paying attention to as well. In general, I think this is a market that if we do cross back above the 0.6450 level, we might see a little bit more of a recovery, but the 50-day EMA above I think would offer pretty significant resistance.

Underneath the 0.63 level would be your target, and I would not be surprised at all to see this market reach that level eventually, but we are getting a little stretched to the downside, so I would prefer to short this market after a bounce and signs of exhaustion. In that scenario, you get more “breathing room” to take advantage of in a strong downtrend.

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This article was originally posted on FX Empire


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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