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AUD/USD Price Forecast – Australian Dollar Continues To Wilt

By:
Christopher Lewis
Published: Feb 25, 2020, 15:23 UTC

The Australian dollar initially tried to rally during the trading session on Tuesday but continues to find plenty of sellers near the 0.66 handle. The coronavirus of course continues to be the main driver at this point.

AUD/USD

The Australian dollar has initially tried to rally during the trading session on Tuesday, but continues to see a lot of selling pressure, mainly because of the coronavirus. After all, the Chinese economy is flat on its back so it’s very likely we will continue to see a lot of selling pressure when it comes to all things China related, and by extension the Australian economy. Ultimately, the demand for copper is a good proxy for the Australian economy as well, as most of the Forex trading is done looking at things like commodity exports to the mainland.

AUD/USD Video 26.02.20

Furthermore, it appears that the Reserve Bank of Australia is likely to cut rates in the near future, and that of course weighs upon the Australian dollar. Ultimately, I do think that we will continue to go lower, as has been seen so far this week. Fading rallies continues to work and in my estimation, we will probably go looking towards the bottom of the financial crisis low which is closer to the 0.63 handle. With this being the case, I do believe that there is a bit of a “ceiling” closer to the 0.67 handle, which should continue to attract a lot of selling pressure based upon the recent action. If we were to break above the 0.6775 handle, then it’s likely that we could go much higher, perhaps reaching towards the 0.70 level over the longer term. It does look as if we are trying to go lower, but if that scenario was the play out you would have to follow right along.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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