AUD/USD Price Forecast – Australian Dollar Gives Up Early Gains

The Australian dollar has shown itself to be a bit hesitant to continue going higher as we initially rallied on Monday but then gave back the gains rather quickly. Quite frankly, the Australian dollar has been one of the worst performing currencies against the US dollar and with the Federal Reserve looking to raise interest rates, it is not a huge surprise to see the US dollar pick up some strength. All things been equal, this is a market that I think is still trying to figure out whether or not it can break down, something that I think is very possible due to the central bank divergence.

AUD/USD Video 11.01.22

That being said, pay attention to commodities, because of course the Aussie dollar is highly levered to those markets, especially copper, aluminum, and iron. All things being equal, this is a market that I like to the downside, but we will have to wait and see. If we can break down below that hammer on Friday, that would be a very negative turn of events and could send this market much lower.

All things been equal, I think the only thing that you can count on is a lot of choppy behavior, and therefore I think what we will have to look at is whether or not we can break the top of the shooting star from Monday, or if we break down below the hammer from Friday. All things being equal, when you get to candlesticks like this in a row, it typically means that you are going to consolidate which makes sense considering that we need to figure out where we are going next.

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