AUD/USD Forecast – Aussie Continues to Do Nothing

Australian Dollar vs US Dollar Technical Analysis

The Aussie dollar rallied slightly during the trading session on Friday as we continue to hang around the 0.65 level. This is a market that has been consolidating for a while and therefore it’s not a huge surprise to see it did very little. With that being said, I think this is a market that you have to look at the 0.6650 level above as the ceiling and the 0.6450 level underneath as the floor. All things being equal, this is a market that I think is just going to stay in this range. There’s no reason for it to break out. And if you look across the forex world, there’s a lot of nothing going on. This could be a very quiet year as central banks around the world are likely to cut rates.

In other words, they’re all moving in the same direction and therefore it keeps the currency pair very lackluster. With that being the case, you have to look at this range and sort out whether or not we are closer to the top or the bottom and perhaps trade in that opposite direction on signs of exhaustion. At this point, we are not quite low enough for me to be a buyer, so I’m basically sitting on my hands. If we were to break down below the 0.6450 level, it could open up a significant amount of selling pressure.

That being said, the market is just meandering. I think this is likely to be how this pair, and many of the major currency pairs, will behave this year. Quite frankly, if central banks are all doing the same thing – then it makes sense that the pairs reflect this.

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