AUD/USD Price Forecast – Australian Dollar Reaches Towards Support Again

The Australian dollar has fallen rather hard during the trading session on Tuesday to break through the 200 day EMA and challenge the idea of the 0.75 level offering support. If we break down below the most recent low, that could open up a significant move to the downside, possibly as low as the 0.70 level. At this point, the buyers need to step in relatively soon, or this market falls apart.

AUD/USD Video 30.06.21

I find this interesting because there are a lot of things going on that could be influential on the Aussie, not the least of which would be the fact that Sydney has been locked down for the next two weeks. Ultimately, that could weigh upon the Australian dollar as it certainly cannot have good effects on the local economy. Furthermore, the Australians and the Chinese are highly linked, and it is worth noting that the Chinese economy has recently slowed down a bit. Furthermore, the bond market in the United States is attracting a lot of inflows, so that makes the US dollar a bit more attractive, at least as far as money flow is concerned.

It is not until we break above the 0.76 level that I feel this market will try to recapture some of the upward momentum. It is also worth noting that until we get above that area that we probably will not have much in the way of short covering, as we have a couple of shooting stars just below there. Ultimately, this is a market that I think will be on the precipice of a much bigger move to the downside.

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