AUD/USD Price Forecast – Australian Dollar Continues to Rally Into Noise

The Australian dollar continues to rally, as the Wednesday session was positive but only begrudgingly so. This is a market that certainly looks as if it is struggling to say the least, and I think it’s only a matter of time before the sellers get involved again. Keep in mind that the Australian dollar is highly levered to the Chinese economy and that of course will be one of its biggest problems. With that in mind I like the idea of fading rallies as they get closer to the 0.67 handle, where I see a lot of selling pressure. I don’t even think we get all the way there, so anything close would work, understanding that the 0.6775 level would be a great place for stop loss orders.

AUD/USD Video 05.03.20

If we were to break above the 0.6775 handle, then it’s likely that market participants will eventually take off to the upside and go looking towards the 0.70 level which is of course a large, round, psychologically significant figure. Ultimately, this is a market that I do feel eventually shows itself to be oversold and bouncing, but not necessarily changing the overall trend. The situation is supposedly getting better in China, but we will have to see as the PMI numbers were horrific. I think at this point it’s very likely to be a scenario where fading rallies continues to work until we test the bottom of the financial crisis which is closer to the 0.63 handle. Australia is likely to continue easing monetary policy so that of course has been working against this currency as well.