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AUD/USD Price Forecast – Australian dollar looking for stability

By:
Christopher Lewis
Updated: Dec 17, 2018, 17:24 UTC

The Australian dollar fell hard during the trading session on early Monday morning, but has found a bit of stability near the 0.7175 handle. This is a market that has been very choppy over the last couple of weeks, as you can see on the chart.

AUD/USD daily chart, December 18, 2018

The Australian dollar has found support near the 0.7175 handle, an area that has been both support and resistance. At this point, it looks as if the market is trying to figure out where to go next, and at this point I think that we will be making a decision rather quickly. Overall, this is a market that will continue to react to the Chinese markets and of course the trade situation between the United States. Overall, this is a market that has a lot of support underneath at the 0.70 level, and I think that level will continue to be a massive part of where we go next. The 0.74 level above is massive resistance, and currently we are hanging about the 0.72 level. That is an area that I consider “fair value”, and as a result it wouldn’t be surprising to see this market go back and forth in this area.

AUD/USD Video 18.12.18

I think the volatility will continue to be an issue, as the headlines will of course continue to be erratic to say the least. I think that the fear is palpable, and of course this is why we have sold off the rally so drastically. I think that will continue to be a significant concern, so ultimately this is a situation where the easiest trade to take is simply fading signs of exhaustion. Otherwise, I think if you are hoping to go long in this market, you’re going to need to be extraordinarily patient and at the very least: brave.

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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