AUD/USD Weekly Forecast – Australian Dollar Falls for the Week

AUD/USD Forecast Video for 14.08.23

Australian Dollar vs US Dollar Weekly Technical Analysis

The Australian dollar initially rallied during the course of the week, but the 0.66 level above offers a significant amount of resistance. Part of the reaction to the CPI numbers on Friday is what caused that, but then we have turned around to show signs of selling pressure, with the 0.65 level offering support. If we were to break down below that level, then it’s a move down to the 0.64 level. The 0.64 level was massive support, but if we give that out, then we could go down to the 0.62 level.

Any rally at this point in time opens up the possibility of a move to the 0.67 level, perhaps even the 50-Week EMA. Keep in mind that we are more or less a “fade the rally” type of situation. All things being equal, the Australian dollar is highly sensitive to the risk the world is really to put on right, and as people are worried about global growth, and of course the global interest-rate environment, it does make a certain amount of sense that the Aussie is suffering.

That being said, I don’t necessarily think that we are going to see some type of meltdown, because we are at fairly low levels. This is more or less a “fade the rally” type of situation that I can see, or perhaps sell the breakdown. All things being equal, the US dollar remains very strong, due to the fact that the Federal Reserve is going to stay tight with monetary policy, and of course the RBA recently decided not to raise rates. This sets up for a certain amount of momentum.

For a look at all of today’s economic events, check out our economic calendar.