AUD/USD Forecast – Australian Dollar Surges Higher

AUD/USD Forecast Video for 21.07.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar experienced a bit of a surge during the overnight session, as Thursday opened up with a bang. Employment numbers were stronger than anticipated, so it does make a certain amount of sense this is the action that we have seen. 0.68 level is an area that previously had been resistance, but we have sliced through it a couple of times here recently, and therefore may be losing some of its efficacy. If we break above the top of the candlestick, then it opens up the possibility of testing the 0.69 level, an area where we have seen a bit of a “double top” form recently.

Underneath the candlestick for the last couple of sessions, you can see that the 200-Day EMA offers a certain amount of support, and of course a lot of traders will be paying close attention to it. Underneath there, then we have the 50-Day EMA coming into the picture, therefore I think you’ve got a situation where the downside is somewhat limited. Don’t get me wrong, I recognize that the Australian dollar is highly sensitive to risk appetite, and of course that means that there is a certain amount of danger in trying to bind the currency, but it’s obvious to me that there’s at least enough push to send this market higher. If we break above that “double top” at the 0.69 level, then it’s likely that the market goes looking to the psychologically important 0.70 handle.

If we were to turn around and break down below the 50-Day EMA, then it’s likely that we will go looking to the 0.66 level, an area that has been massive support. Either way, I think you are going to see a lot of volatility here, especially as traders try to sort out what’s going on in the global economy as it seems like there is a lot of inflation, but at the same time, there seems to be slowing down economic momentum in multiple places around the world. Because of this, position sizing will be crucial, as the Aussie can get quite wild at times when there’s a lot of uncertainty out there, just as there is at the moment.

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