AUD/USD Forecast – Australian Dollar Continues to Consolidate Overall

AUD/USD Forecast Video for 10.10.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar initially gapped lower to kick off the trading session on Monday, as we continue to see a lot of volatility when it comes to risk appetite. Keep in mind that the Aussie dollar has been highly influenced by global growth narratives, and that of course is a scenario where we continue to look around the world and try to sort out what’s going on.

The interest rate differential between the 2 economies of course is a very major driver of where we are going, and therefore I think we have to look at this through the prism of whether or not the Federal Reserve is going to continue to stay tight for longer. At this point, I do think that they will, but one thing worth noting is that during the Monday session, it was Columbus Day in the United States and therefore the bond markets were closed.

As we continue to rally now, I’m looking at the 0.64 level as a potential area of resistance. This is an area that of course is a large, round, psychologically significant figure, and an area that has previously been important. We have traded back into that previous falling wedge, so at this point in time I think we can probably remove those lines from the chart. Underneath, the 0.63 level is an area that I think we could target, and any signs of negativity will send this pair lower. The market will remain very choppy in general, and therefore you need to look at it as a market that you need to be very cautious in.

Yes, we are very noisy, but we were also at extreme lows so we could see a bit of value hunting. That value hunting might get somebody hurt, so I’m not interested in getting involved until we break above the 0.6550 level. The 50-Day EMA sits just below that level, and it does offer a significant amount of resistance as well. I’m simply waiting for signs of exhaustion to take advantage of this market and start picking up “cheap dollars” yet again. When the bond market opens up on Tuesday, that will probably give us a lot of answers.

For a look at all of today’s economic events, check out our economic calendar.