AUD/USD Price Forecast – Australian Dollar Continues Sideways MomentumThe Australian dollar rallied a bit during the open on Tuesday but continues to look very tight and tired. At this point, there probably is not a lot to do.
The Australian dollar initially rallied on Tuesday but continues to struggle with the idea of breaking above the 50 day EMA. This is a market that is highly focused on risk appetite and whether or not there is going to be stimulus coming out the United States. We already know that the Reserve Bank of Australia is very likely to cut interest rates at the November meeting, so at least part of the equation is already known. Nonetheless, this is a market that will be paying close attention to whether or not there is going to be massive stimulus out the United States, because that should increase the value of commodities, at least in theory. If it does, that is typically good for the Aussie dollar.
AUD/USD Video 28.10.20
To the downside, there is a significant amount of support between the 0.71 level and the 0.70 level, and therefore it is going to be difficult to break down below there. If we do, then it opens up a serious attempt at breaking through the 200 day EMA and then reaching towards the 0.68 level. It certainly looks as if there is a certain amount of concern out there, and that could work against the value of the Aussie dollar as well. Because of this, you need to be very cautious but recognize that more than anything else we look to be a bit range bound and simply waiting to see whether or not the US dollar gets another round of bullish pressure. If it does, then we can look towards the potential descending triangle for a measured move down to that 0.68 handle.
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