AUD/USD Price Forecast – Aussie Continues to Plunge

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has dipped to a fresh, new low during the trading session on Wednesday, as we await the Federal Reserve and their next statement. At this point, it’s very likely that we will see an extraordinarily hawkish Federal Reserve, and therefore it would make a certain amount of sense that the traders out there will continue to favor the US dollar. We are in the midst of breaching a major support level on the Australian dollar, and one would have to think that it is probably only a matter of time before the floodgates open.

Rallies at this point should end up being selling opportunities, because quite frankly there is no reason to take a huge amount of risk at this point. Market participants quite often equate the Australian dollar with commodities, and if we are in fact going to see a massive global slowdown, it does make a lot of sense the commodities will get pounded. Furthermore, the Chinese economy seems to be like a bug looking for a windshield, and the Australian economy is highly levered to that. In other words, there’s not a lot working for the Aussie at the moment.

Having said that, it is worth noting that the Australian dollar has been much more stubborn to US dollar strength than many of its contemporaries. It is because of this that I think we have not completely broken through quite yet. I do believe that it is probably only a matter of time though, so in this scenario I prefer to fade rallies or short a fresh, new low if we do in fact get one. A potential target could be the 0.65 level.

AUD/USD Price Forecast Video for 22.09.22

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