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AUD/USD Price Forecast – Australian dollar stalls on thin holiday trading

The Australian dollar went back and forth during the trading session on Independence Day in the United States, which of course is very thin trading for roughly half of the day.
Christopher Lewis
AUD/USD daily chart, July 05, 2019

The Australian dollar has gone back and forth during the trading session on Thursday as Americans were away for Independence Day celebrations. That being said, we are at significant resistance so it’s not a huge surprise to see the market fail to continue going higher without some type of catalyst. If we can break above the top of this candlestick though, it’s very likely that this market continues the breakout. All things being equal, it does look as if the Australian dollar is trying to do that but we may need to pullback in the meantime in order to do that.

AUD/USD Video 05.07.19

To the upside, if we break above the resistance overhead, we will probably go to the 0.72 level, possibly even the 0.7250 level. On the other hand, if we were to break down from here the 50 day EMA which is pictured in red should be supported. That being said, if we were to break down significantly the market does seem to move in 50 pips increments underneath, which this area has been a bit of a bottoming pattern. That being said, one thing that is helping this pair go higher is the fact that the Federal Reserve is looking to cut interest rates in the future. With that being the case, it does weigh upon the US dollar, and it also suggests that we are going to see more of a “risk on” situation. We have also had a call mean of the US/China trade situation, so that of course can help the Australian dollar as well as it is a proxy for that region.

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