AUD/USD Forecast – Aussie Continues to Struggle With Moving Averages

Australian Dollar vs US Dollar Technical Analysis

You can see that the Australian dollar has reached towards the 50 day EMA only to give up quite a bit of the gains early in the session. This comes right after a session that initially on Tuesday pierced the 50 day EMA, but also gave up gains. In other words, this is looking very much like a market that’s going to continue to struggle in this general vicinity, as traders are trying to sort out whether or not the market will be able to pick up any type of momentum.

So, what this tells me is that it’s going to be very difficult to continue going higher and break above this 200 day EMA. Now, that doesn’t necessarily mean that the pair falls apart from here, just that we will continue this tight choppy behavior. The 0.65 level underneath is an area that I think is rather important. Even though we’ve jumped through it a couple of times, it’s a large round number that I think will attract a lot of attention.

On the upside, the 0.66 level is an obvious resistance, assuming that we can even get there. And essentially what we’ve done over the last two days as the Aussie has risen, has just gotten halfway between those two levels. If we can break out above 0.66, then 0.67 is your next target. All things being equal, the Australian dollar continues to move on the idea of interest rates in the United States, global trade, and of course, the Chinese economy. Remember, the Australian dollar is basically a proxy for China for FX traders.

It’s also a proxy for gold at times, although you’re not really seeing that on this chart. And of course, just hard commodities in general, as that’s a bulk of Australia’s exports. Beyond that, a lot of traders just look at the Australian dollar as a “riskier currency” than the US dollar. That being said, we do get the FOMC Meeting Minutes out of the United States late in the session so that could come into play at one extent or the other.

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