AUD/USD Price Forecast – Australian Dollar Get Hammered

The Australian dollar got hammered during trading on Tuesday, reaching down towards the 0.6840 level, and even more importantly, the 50 day EMA. The 50 day EMA is starting to turn to the upside and could offer a significant amount of support. A bounce from there could send this market towards the 200 day EMA again, which of course is starting to slope lower. It looks as if the Australian dollar is trying to rally longer-term, as we move back and forth via the US/China trade deal.

AUD/USD Video 18.12.19

The fact that a “Phase 1 deal” has been agreed upon in principle is bullish for the Australian dollar, but nothing has actually been signed yet and one would have to think there is a certain amount of caution out there because of the history between the Americans and the Chinese of getting relatively close, only to see the whole thing blow up again. The 0.68 level underneath is support, and if that gets broken it would be a negative sign. It would be the end of the “higher lows” that have been formed. At that point I would anticipate that the market could go down to the 0.67 handle, where we have seen a longer-term double bottom form.

To the upside, if we can clear the 200 day EMA for any serious length of time, that probably sends this market to the upside for a bigger move. There is also the 61.8% Fibonacci retracement level right there as well, showing that area to be very difficult to overcome but if we can do so, that should send this market much higher.

Please let us know what you think in the comments below