AUD/USD Forecast: Aussie Looking Threatened

[ad_1]

It looks as if we are going to be held hostage to headlines around the world, none of which look that good at the moment. 

The Australian dollar fell during thin trading on Friday as we continue to see a lot of negative pressure in this market. That being said, the Australian dollar has broken below the 0.74 level, and it looks like it is ready to go lower. The Australian dollar is highly correlated to the commodities markets, so you need to pay close attention to it as global demand is going to be a major issue.

Advertisement

Inflation is an issue as well, and the Federal Reserve is so hawkish does drive up the value of the US dollar. That being said, the market is trying to break down a bit from here and favor the greenback, and now it looks like we are ready to reach towards the 50-day EMA. The 50-day EMA is rapidly approaching, so that will be the next major barrier. That being said, a lot of things have changed in this pair as of late, not the least of which is that the Reserve Bank of Australia has dropped the word “patience” from its statement, suggesting that it was going to be a bit more hawkish than originally thought. However, since then, we have seen the FOMC Meeting Minutes come out much more hawkish than anticipated, so that reverses any type of bullish pressure for the Aussie. The fact that we are closing at the bottom of the candlestick suggests that there could be a bit of follow-through as well.

If we can break down below the 200-day EMA, then the Aussie is likely to go much lower, perhaps falling all the way back down to the 0.70 level. Speaking of which, when you look at the chart, you can see that this 500-point range has been important more than once, so if we fall from here, it would just be a simple continuation of that larger consolidation area.

Keep in mind that the market faces quite a few risks at the moment, and it does make sense that the Aussie struggles overall. After all, it is very sensitive to risk appetite in global growth. It looks as if we are going to be held hostage to headlines around the world, none of which look that good at the moment. Ultimately, the market is more likely to fall than to rise. The 0.75 level should continue to be a bit of a “ceiling.”

AUD/USD

[ad_2]

Leave a Reply

Your email address will not be published. Required fields are marked *

Risk warning: Trading Forex (foreign exchange) or CFDs (contracts for difference) on margin carries a high level of risk and may not be suitable for all investors. There is a possibility that you may sustain a loss equal to or greater than your entire investment. Therefore, you should not invest or risk money that you cannot afford to lose. Before using xMetaMarkets services, please acknowledge all of the risks associated with trading.

The content of this website must not be construed as personal advice. We recommend that you seek advice from an independent financial advisor.

The information on this website is not directed to residents of certain jurisdictions such as United States, Canada, Iran, Cuba, France, and some other regions, and is not intended for distribution to, or use by, any person in any countries or jurisdictions where such distribution or use would be contrary to local law or regulation.

© 2018 - 2024 xMetaMarkets.com. All Rights Reserved.