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AUD/USD Forecast – Australian Dollar Continues to Look Very Weak

By:
Christopher Lewis
Published: Feb 29, 2024, 13:34 UTC

The Aussie dollar initially tried to rally during the trading session on Thursday, but then turned around to show signs of weakness.

In this article:

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar initially tried to rally during the trading session on Thursday but gave back gains rather quickly. At this point, it’s likely that the market is going to continue to see a lot of volatility and noisy behavior. But that being said, I think you also have a situation where you have to be cognizant of the fact that the issue that you have is the Australian dollar is so highly levered to the Chinese and of course, Asian economies overall that we have to pay attention to how things are going there.

Furthermore, we also have the situation where the Federal Reserve is supposed to be cutting this year but at the same time, it looks a lot like they may be pushing back, we don’t know. But certainly, Wall Street got ahead of itself as well as the many other major trading centers. The PCE numbers will come out and that will of course have a lot to do with where we go next. And with all of that being said, I think you have to look at the 0.65 level as a bit of a magnet for price. I think that continues to be the case, and with the 0.65 level will be in an area where you would see a lot of options trading, it does make perfect sense. However, it’s also worth noting that the market has sliced through that level several times, so it’s not acting like a brick wall anymore.

If we do break down below the 0.6450 level, then it’s likely that we could go to the 0.63 level. If we rally from here, the 50 day EMA above is a major EMA and then after that we have the 200 day EMA if we break above there then the 0.66 level comes into the picture, and I think is your ceiling all things being equal I think we either go sideways or we break down more likely than anything else with that being said, the Aussie probably continues to be a fade the rally situation.

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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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