AUD/USD Forecast – Australian Dollar Continues to Recover

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Published: Jan 19, 2024, 14:48 GMT+00:00

The Aussie dollar has rallied quite nicely during the Thursday and Friday sessions, as it looks like we are hanging around the bottom of an overall range, therefore it does make a certain amount of sense that recovery continues.

AUD/USD Forecast Video for 22-01-2024

Australian Dollar vs US Dollar Technical Analysis

The Aussie dollar rallied just a bit to kick off the trading session on Friday. Reaching the 200-day EMA, at this point, this is a market that I think will continue to be a buy-on-the-dip market, at least in the short term. The 200-day EMA is an indicator that will cause a lot of noise. And the fact that we are here does make quite a bit of sense. Breaking above the 200 day EMA then opens up the possibility of a move to the 50 day EMA.

All things being equal, this is a short term market that does favor the upside. But when I look at the longer term chart, the 0.65 level is a massive support level with the 0.69 level above being a massive resistance level. I do think that if we continue to rally, we’ll attempt to get to the 0.67 level, an area that is essentially fair value. If you are a longer term swing trader, then it looks like the Aussie might be trying to turn things around and it is something worth paying attention to. You should also pay attention to the commodities markets because the Australian dollar is highly levered to those.

Asian growth is also another thing that you need to pay attention to as well as global growth. Pay attention to the 10-year yield in the United States because it has a massive influence on what happens with the U.S. dollar as well. So you have to monitor all of this, recognizing that we are at the bottom of a massive consolidation phase, and the 0.65 level, I think, is the short-term floor.

If we were to break down below there, it would be a very negative turn of events, possibly opening up a move down to the 0.6350 level, but right now, we just aren’t showing signs of that proclivity. The Aussie looks like it’s going to try to rally to the aforementioned 0.67 level, and as things stand right now, I think a small, reasonable position could be one way to play this to the outside.

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About the Author

Christopher Lewisauthor

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.