AUD/USD Weekly Price Forecast – AUD Continues to Test Support

The Australian dollar has had a slightly negative week, after recovering on Thursday. Thursday was an interesting session, because we had seen a complete reversal of US dollar strength, not only here but in other places. The reality is that a lot of position squaring probably happened on Thursday as Friday was Good Friday and therefore a lot of banks would have been close. Furthermore, it was the jobs report in America, which came out like gangbusters. Obviously, a lot of traders would have no interest in putting on a bunch of risk and simply holding it through that type of illiquid market, so it makes quite a bit of sense.

AUD/USD Video 05.04.21

If we break below the bottom of the candlestick, that opens up a move down to the 0.73 handle, possibly even the 0.72 handle. On the other hand, if we turn around a break above the top of the gains that we probably grind towards the 0.7750 level initially. This obviously would need to see a lot of anti-dollar sentiment, which will be interesting to see how things play out when we get back to work due to the fact that the jobs number was so strong. Pay attention to the 10 year yield, if it starts to spike again, that more than likely will drive the dollar higher, at least in the short term. I think the one thing you can probably count on is that we are going to have a lot of noise in this market and therefore it is going to be very difficult to trade at times. Longer-term, we are still very much in an uptrend so that is worth keeping in the back of your head.

For a look at all of today’s economic events, check out our economic calendar.