AUD/USD Price Forecast – Australian Dollar Flat After Contentious Weekend

The Australian dollar went back and forth during trading on Monday, hanging near the 0.6950 level. This is an area that I have identified as potential support from a longer-term standpoint and therefore I do anticipate the buyers could return. However, as tensions rise in the Middle East and Africa, it’s a bit difficult to get overly excited about owning riskier assets such as the Australian dollar. Granted, the Australian dollar also benefits from the US/China trade relations getting better, so that is something to keep in the back of your mind.

AUD/USD Video 07.01.20

If the market does break down from here the 200 day EMA should come into play as support. Currently just below the 0.69 level, it would also have that large, round, psychologically significant figure just above it is offering support. Underneath there, the 50 day EMA is starting to curl higher and looks as if it is going to eventually cross above the 200 day EMA, forming the so-called “golden cross.” That of course is a very bullish sign. All things being equal, I do like the Australian dollar, but I also recognize that we are in the midst of a major trend change, and that is almost always a noisy affair anyway. Adding a mix of Middle East tensions, it is hardly surprising that the Aussie may struggle a bit against the greenback even as it turns around the longer-term trend. I continue to look at dips as potential buying opportunities but recognize there’s no need to be a hero here.

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