AUD/USD Price Forecast – Australian Dollar Recovers Nicely During Tuesday Session

The Australian dollar has initially fallen during the trading session on Tuesday but gave back the losses in order to break back above the 0.65 handle. We are currently testing that area to the upside slightly, but it should be noted that the Aussie dollar has been dancing around this area for quite some time. With that being the case it makes sense that we would probably see a lot of choppiness in this area, and as a result this is a market that looks as if it is trying to resolve a longer-term argument, but right now have no real catalyst to make that move.

AUD/USD Video 13.05.20

The Australian dollar is highly levered to the global growth situation, so that of course will come into play quite a bit. Ultimately, I believe that the Australian dollar is likely to give up the gains, but the reality is that the market is levitating regardless of any economic reality. This perhaps is in recognition of the fact that the Federal Reserve is going to flood the market with an unfathomable amount of money. Perhaps they will eventually succeed, but at this point it is exceedingly difficult to understand why the market would believe that growth comes back the way it used to be, but the reality is that is what the market is pricing in. The last couple of months have shown just how disconnected financial markets have become from the economic reality, and I anticipate that if and when reality comes knocking, it will be a sudden and violent reversal.