AUD/USD Price Forecast – Aussie Dollar Gives Up Gains After Dovish RBA

The Australian dollar initially tried to rally during the trading session on Tuesday but gave back the gains as the RBA was a bit more dovish than anticipated. Furthermore, the market is attracted to the 50 day EMA, so it looks like we are ready to break down below the 50 day EMA. At that point, I think that the market could go looking towards the 0.75 handle, a large, round, psychologically significant figure. The concern about the global growth situation also is something to worry about. After all, the Australian dollar is highly levered to that entire situation, and quite frankly it is starting to look less likely that we simply shoot straight up in the air as far as growth is concerned.

AUD/USD Video 03.02.21

On the other hand, we are in an uptrend so that is something that you need to pay attention to. The area near the 0.75 level is massive in its implications, and a breakdown below there could reach towards the 200 day EMA near the 0.7250 level. Ultimately, we are probably going to find buyers sooner or later, but there is a concern that maybe we need a deeper correction in order to go higher. Ultimately though, if we were to break above the 0.78 level above, that could send the market towards the 0.80 level. That is a large, round, psychologically significant figure that will attract a lot of attention from a longer-term standpoint, and therefore I think it makes a nice target. Breaking above there then has the Australian dollar more of a “buy-and-hold” situation. At this point, I think we are probably going to see more choppiness than anything else.

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