Yahoo Finance AUD/USD Forecast – Australian Dollar Rallies After Initial Drop
AUD/USD Forecast Video for 20.11.23
Australian Dollar vs US Dollar Technical Analysis
The Australian dollar fell significantly during the course of the session early Friday morning, but then turned around to explode to the outside and reach toward the crucial 0.65 level. That of course is a large, round, psychologically significant figure, and an area where we have seen a massive shooting star previously. Furthermore, we have the 200-Day EMA above offering resistance, therefore I think you probably have a situation where we continue to fade rallies as they occur.
Keep in mind that the market will continue to be noisy and of course pays close attention to the Australian dollar as a “risk on currency”, therefore I think you need to look at this through the prism of what’s going on with geopolitics. It looks a lot like a market that is trying to break out of a major resistance barrier, but the 200-Day EMA above is a real barrier that’s going to be difficult to break above that. If we can clear that, then the 0.66 level opens up a move to the 0.69 level. This would obviously be a very negative US dollar move, and it certainly looks like we are at least attempting to sort that out.
On the other hand, if we do fall from here, the 50-Day EMA underneath is likely to be a bit of a target for sellers, and if we break down below the bottom of the candlestick on Friday, that very well could be where we had to. 0.64 level is an area that a lot of people will pay close attention to as it has previously been both support and resistance, and is essentially the “midpoint” in the larger consolidation area that we have been in.
Expect a lot of volatility, therefore you need to be very cautious with your position sizing initially, but you can add to it as the trade works out in your favor. The Australian dollar seems to favor short-term range bound trading at the moment, but we are most certainly knocking on the door of at least trying to break out at this point. In general, I think we’ve got a situation where volatility continues to drive the markets more than anything else.
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This article was originally posted on FX Empire
