AUD/USD Forecast – Aussie Struggles to Hold Gains in Early Wednesday Trading

AUD/USD Forecast Video for 08-02-2024

Australian Dollar vs US Dollar Technical Analysis

This suggests to me that the market is going to continue to go back and forth around the 0.65 level. This is an area that is important because it used to be the major resistance above and now it looks like it’s trying to form some type of support region. Ultimately, I think this is a market that doesn’t really know where it wants to go. You could say that about a lot of currency pairs at the moment, not just this one, so in all fairness, this isn’t unique to the Aussie dollar.

Because, quite frankly, risk appetite is all over the place. With that being the case, I like the idea of waiting to see if we get some time heaven pulse of candlestick to trade off. Also, the 50 day EMA is starting to cross below the 200 day EMA, kicking off the so-called death cross, which of course is a negative sign, but quite frankly, it’s normally pretty late, so we’ll see.

At this point in time, if we were to rally to the 0.66 level above, it looks to be rather resistive. Underneath, we have a lot of support at the 0.6475 level but anything below there probably opens up a move down to the 0.63 level in the Australian dollar. Keep in mind the Australian dollar is highly levered to what happens in China and Asian markets in general. Ultimately, we have a scenario where risk appetite could come into the picture because a lack of risk appetite very well could make the US dollar a lot more attractive as well, so do keep that in mind.

I expect choppy conditions but I’m not expecting a big move one way or the other, at least not in the short term. But once we get a long candlestick, that could give us a bit of a heads up as to where we end up moving to. I suspect once we know, things will get a bit more aggressive in momentum trading. Until then, you will have to be very cautious or at least very patient. Position sizing is also something that you should keep in the back of your mind every time you get involved here.

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