AUD/USD Price Forecast – Australian dollar trying to form base again

The Australian dollar initially tried to rally during the trading session on Wednesday, slamming into the 0.69 level. This is an area that obviously will attract a lot of attention, but I think the 0.6850 level underneath is going to continue to be support, extending down to the 0.68 level after that. I believe that we won’t be able to break down below there unless of course the Federal Reserve decides not to cut interest rates, which is almost impossible to imagine at this point.

AUD/USD Video 01.08.19

At this point in time I do believe that we are going to start to see some type of rally, but we also need a bit of stability first. With that being the case, I think that you can start to build a small position to the upside but I would also emphasize the word small here. You will want to slowly get involved, perhaps looking at every 50 pips or so as a potential target to the upside. The downtrend line above of course continues to be a major barrier to overcome, so it’s not until we break above there that the longer-term “buy-and-hold” crowd can start to look at the Australian dollar seriously. Keep in mind that this pair does tend to move back and forth with the US/China trade situation as well, so that could have a bit of an effect also. Looking at this chart, we are oversold.

Please let us know what you think in the comments below