AUD/USD Forecast – Australian Dollar Bounces After Initial Selloff

AUD/USD Forecast Video for 31.07.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has fallen rather significantly during the trading session on Friday, reaching down toward the 0.66 level before bouncing yet again. This is a market that is range bound, and I think we are going to continue to see more of the same. With that being the case, the market is likely to see a lot of volatility, with the 0.66 level underneath being a bit of a floor in the market. The 50-Day EMA sits just above, and then after that we have the 200-Day EMA above there as well. The 0.68 level above that ends up being significant resistance, followed by the 0.69 level, where we had formed a bit of a double top.

All things being equal, this is a market that still looks very noisy and I don’t see us breaking out of the range anytime soon, unless of course there is some type of panic move. That would more likely than not favor the US dollar, which would be more or less a move toward safety. If we break down below the 0.66 level, then the market then goes down to the 0.65 level. The 0.65 level is an area where we had found support previously, so therefore it’s likely that we could go down to the 0.64 level.

In general, I think this is a situation where we continue to see a lot of noise, and therefore you need to be very cautious for the time being, but I think if you are range bound trader, you may like this pair, as it has so many clear levels that people will be paying close attention to. Obviously, if we break out of this well-defined range, then the market will make a bigger move, and therefore becomes more or less a longer-term trade just waiting to happen. The Aussie dollar has been very noisy not only due to questions about the US dollar, but the fact that the Australian dollar is highly levered to the commodity markets, and of course global growth in general as Australia is so highly levered to the Chinese demand picture as it is a forerunner to global demand.

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