AUD/USD Price Forecast – Australian Dollar Continues Sideways Chop

The Australian dollar has rallied a bit during the trading session on Monday to break above the 0.71 handle. That being said, there is still a lot of resistance above, and it could continue to cause some issues. Furthermore, the 50 day EMA is sitting above as well, and a certain amount of attention will be paid to that indicator as per usual. Ultimately, this is a market that has recently broken an uptrend line, and now we are going to pay attention to the Aussie going forward as far as any potential weakness.

AUD/USD Video 20.10.20

Further exacerbating the situation has been the fact that the Reserve Bank of Australia has recently hinted very strongly that there were interest rate cuts coming down the road. If that is going to be the case, then it should work against the value of the Aussie in general. Underneath, there is significant interest and support right around the 0.70 level, as well as the 200 day EMA racing towards that figure. Ultimately, if we were to break through all of that then it would almost certainly bring in a significant break down in this pair, perhaps sending it down to the 0.68 level and beyond.

Looking at this chart, I believe that we are probably going to see a lot of back and forth type of trading, at least in the short term as we try to figure out where to go next. Keep in mind that this is also a very risk sensitive currency pair, so depending on what is going on in the world, there may or may not be a drive towards the US dollar.

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