AUD/USD Price Forecast – Australian Dollar Grinding to The Upside

The Australian dollar initially dipped a bit lower during the trading session on Thursday but then went higher to look at the 0.74 level as short-term support. Ultimately, this is a market that I think is trying to go to the 0.75 level but with the Non-Farm Payroll number coming out on Friday, we could see a little bit more volatility. That being said, it almost makes you wonder whether or not the jobs number is going to be what finally kicks off a bigger move.

AUD/USD Video 04.12.20

At this point in time, I believe there is also supported at the 0.7350 level, extending all the way down to the 0.7250 level. With this being the case, I think that there are plenty of buyers underneath that will continue to see reason to go long. After all, the Federal Reserve is looking to flood the market with liquidity. Ultimately, this is a market that is trying to break out for a longer-term “buy-and-hold” scenario, as we are going to see a lot of liquidity jumping into the market in order to drive prices of commodities higher. This of course will drive this market higher as the Australian dollar is so highly correlated to gold, copper, and the like.

The 50 day EMA is sitting at the 0.7250 level, so I think that will only reinforce that zone of previous resistance which should now be support. If we get some type of shock number coming out the United States, that might give us a pullback that we can take advantage of but clearly you cannot be a seller of the Aussie dollar as it continues to strengthen overall. As people are starting to focus on the “reflation trade”, it makes quite a bit of sense that the Aussie continues to be a favorite.

For a look at all of today’s economic events, check out our economic calendar.