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

The Australian dollar has gone back and forth during the session on Wednesday, digesting some of the major losses that happened during the Tuesday session. At this point, if we break down below the bottom of the Wednesday candlestick, then it is likely that we drop somewhat significantly. In general, I think this is a market that continues to look very weak, as the 0.73 level had been major support. Furthermore, when you look at the length of the candlestick from the Tuesday session, it is obvious that we have a lot of selling, especially as Australia seems hell-bent on destroying its own economy through lockdowns.

AUD/USD Video 19.08.21

Beyond that, the Royal Bank of New Zealand did not cut interest rates overnight, which does tend to have a bit of a “knock on effect” in Australia as the two currencies tend to trade parallel. With that being the case, I think there is still high probability that we break down and continue to go lower. The Australian dollar is likely to go looking towards the 0.72 level and be sold into every time it rallies a bit. Longer-term, I anticipate that this market will eventually go looking towards the 0.70 level, an area that I have been paying close attention to for quite some time.

The 0.70 level is massive support and of course a psychologically important figure, so I think at this point it is very likely that there will be a lot of attention paid to that region. As far as buying is concerned, we would have to take out the 0.73502 even have that conversation, something that does not look very likely at this point.

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