AUD/USD Price Forecast – Australian Dollar Recovers to Close Out Week

The Australian dollar is rallying to close the week out, recovering from a break down below the 0.73 level. The 0.73 level has been important multiple times, so the fact that we breakdown through there was a very negative sign. That being said, now that we have recovered a bit during the day on Friday, it is very likely that sellers will come back into the picture on signs of exhaustion. Because of this, I am looking at this market through the prism of selling the rallies, which is the best way to play a choppy downtrend line.

AUD/USD Video 20.09.21

Above current trading, there is the 50 day EMA, which comes into the picture. The 50 day EMA is an area that I think will continue to attract a lot of attention, currently sitting at roughly the 0.7385 above. Now that we have made that move lower, I suspect that we are going to see this market continue the overall choppy but negative behavior. Looking at this situation, I think that US dollar strength may continue to be the mainstay in this market, especially as Australia is suffering at the hands of massive lockdowns and protests, while the government tries to destroy its own economy.

Furthermore, the Chinese are rattling sabers again when it comes to the Aussies, at the same time they are having issues with the economy itself. Remember, the Chinese are major consumers of hard commodities when it comes to Aussie goods. The 200 day EMA previously had been massive resistance and kicked off this move to the downside. All things been equal, I think we do continue the downtrend, but it is not necessarily going to be a smooth ride.

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