AUD/USD Price Forecast – Australian Dollar Continues to Look Strong

The Australian dollar has rallied a bit during the trading session on Thursday to show even more bullish pressure. That being said though, the market is likely to continue seeing buyers going forward, and I do think that the US dollar is probably in serious trouble longer term. That being said, I do believe that we might be getting a little bit stretched due to the lack of liquidity. I would like to see a short-term pullback that I can take advantage of because it could offer value. With this, it should get a bit of a boost based upon those who will have been gone during the holidays and looking to take advantage of what is an obvious “anti-US dollar bias” in general.

AUD/USD Video 04.01.2021

To the downside, I believe that the 50 day EMA crossing the 0.74 level should be a sign of that general vicinity offering support as it had previously offered resistance. This is roughly a 100 point range that I think a lot of people will be paying close attention to, as the market has been dealing with this area for quite some time over the longer term. At this point, I have no interest in shorting the Australian dollar, unless of course some type of major “risk off event” in the world which would have people running towards the greenback.

Currently, I do not see that and there is a significant amount of stimulus coming. As long as that is going to be the case in the United States, that should continue to work against the greenback, and thereby drive commodities higher overall based upon the “reflation trade”, which directly helps the Australian dollar.

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