AUD/USD Forecast – Aussie Looks Strong Early on Tuesday

Australian Dollar vs US Dollar Technical Analysis

The Aussie dollar initially pulled back just a bit during the trading session on Tuesday, only to turn around and show signs of strength again. With that being said, the market looks as if it is ready to go looking to the 50-day EMA, possibly the 200-day EMA after that. The 0.6625 level is an area that I think is going to be paid close attention to as resistance, because if we can break above there, that would be a major coup for the Aussie Bulls. On the other hand, if we turn around and fall, the 0.65 level is an area that’s seen a lot of action in the past, so we’ll have to wait and see. If that holds underneath there, the 0.6450 level is the latest swing low, and of course, that should be supported as well.

If we were to break down below there, the Aussie is going to have the bottom fall out of it and we’ll find ourselves down at the 0.63 level rather quickly. In general, this is a risk on, risk off type of currency pair. So do be aware of that as traders will look at the Chinese economy for signs as to where the Aussie may go.

The Federal Reserve of course, has a significant influence on the US dollar because a lot of people are banking on the Federal Reserve cutting rates later this year. However, it’s worth noting that the timeline of that has been pushed back a bit, so we’ll have to wait and see. The one thing that I do see on this chart is going to be a lot of choppiness and a lot of noise. So, therefore, you have to be cognizant of the fact that this is probably more or less going to be a short term trader’s type of market. We are seeing support and resistance spaced out in something like 50 pip increments, which does not give us a lot of room to move around. Because of this, unless you’re a short-term trader, the Australian dollar probably isn’t going to be the pair for you, at least not at the moment.

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