AUD/USD Weekly Price Forecast – Aussie Continues to See Volatility

Australian Dollar vs US Dollar Weekly Technical Analysis

Taking a look at the Aussie dollar on the weekly time frame, you can see that the Australian dollar has rallied rather significantly during the course of the week to show signs of life. We’ve even reached the 50 week EMA but have pulled back slightly from that area. What you don’t see on the weekly chart is the fact that several days in a row we have rallied only to give up those rallies. This is something that we need to pay close attention to because, quite frankly, the Australian dollar is a bit of a “canary in the coal mine” for the Asian markets, and even the commodity markets at times.

So, I think we’re in the middle of a bottoming process and it’ll be interesting to see what happens next. That being said, if we can break above the 50 week EMA, I do think that it is probably only a matter of time before we go looking to the 0.69 level. On the other hand, if we turn around and break down below the bottom of the hammer from the previous week, that opens up significant selling, perhaps down to the 0.63 level.

In general, the Australian dollar should be thought of as a proxy for risk appetite and traded as such. This has always been the case with the Australian dollar, and of course as the Aussie dollar is so highly levered to commodities and China, you need to keep that in mind as well. This is essentially a “risk on/risk off” type of pair.

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