AUD/USD Forecast – Australian Dollar Continues to Fight Upstream

Christopher Lewis
Published: Feb 16, 2024, 14:35 UTC

The Australian dollar continues to fight a lot of downward pressure, and Friday did see a little bit of resilience pop into the marketplace as we continue to fight the current. This is akin to a fish trying to swim upstream.

Australian dollar, FX Empire

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AUD/USD Forecast Video for 19-02-2024

Australian Dollar vs US Dollar Technical Analysis

The Aussie dollar initially pulled back a bit during the early hours on Friday but has since shown a little bit of resiliency near the 0.65 level, an area that has been on my radar multiple times and I think will continue to be so, as market participants look at it as a potential fair value level from what I can see.

All things being equal, this is a market that remains very range-bound and tight, and even if we do break out to the upside, I think there are a lot of concerns about where the Aussie could go next. After all, the 0.6550 level is your short-term resistance barrier, but we have the 50-day EMA sitting just above there, with the 200-day EMA following it. After that, then you have the 0.66 level, and I think that is another area you need to pay attention to.

In other words, I think of the Australian dollar as being like it’s in a traffic jam at the moment. Yes, it could make a sudden move, but right now there are so many barriers it’s difficult to get overly excited about one direction or the other. I expect choppiness to be a feature of this market, something that could frustrate a lot of traders that don’t have the proper trade setups or systems.

That being said, if we were to turn around and fall below the 0.6433 level, then I think the Australian dollar has a real shot at falling apart reaching down to the 0.63 level. In general, this is a market that I think will continue to chop back and forth, so if you’re a short-term range-bound trader, this is probably the currency pair for you. The Australian dollar, of course, is highly levered to global growth, Asia, which isn’t doing all that well, and of course, commodities in general. The Federal Reserve looks to be cutting rates this year, but maybe much later than people thought, so the US dollar has hung on to some strength because of this as well.

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About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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