AUD/USD Forecast – Australian Dollar Bounces Hard

AUD/USD Forecast Video for 14.12.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has fallen significantly during the trading session on Wednesday to reach down toward the 50-Day EMA which also sits right at the 0.65 level. The 0.65 level is a large, round, psychologically significant figure, and an area where we previously had seen resistance. Because of this, it’s likely that the market will continue to see a lot of noisy buyers underneath, but at the same time, you can make a strong argument that there’s a lot of resistance above, especially near the 0.6650 level.

Adding even more noise to the situation is the fact that the market is likely to continue to see a lot of noise due to the Federal Reserve announcement later in the day, so I think at this point we are just simply trying to figure out what the Fed is going to do as far as monetary policy. Ultimately, this is a situation where the market is trying to figure out whether or not the Federal Reserve is going to keep its monetary policy tight, or if it’s going to start loosening to it again. Recently, we have seen some inflation numbers suggest that they may have to stand pat, so that has caused some issues.

In general, this is a market that looks to be range bound and it would not surprise me at all to see this market go back-and-forth and do a whole lot of nothing between now and the end of the year. After all, liquidity could be an issue at the end of the week, as we start to coast into the holiday season. That being said, if we were to break out of this range, then that gives you an idea as to where the next move may be. A move below the 0.65 level on a daily close could get me selling this pair, just as a move above the 0.6650 level on the daily close could get me buying it. Either way, pay close attention to the bond markets in America, because if the yields start to rally, then it suggests that the US dollar should strengthen in general. In general, I think this is a scenario where you have a lot of noise just waiting to happen.

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