AUD/USD Weekly Price Forecast – Aussie Pulls Back Only to Take Off

The Australian dollar pulled back a bit during the week to reach towards the 0.7350 level. At that point, buyers came back into the market and sent the Australian dollar towards the 0.7450 level. The candlestick is rather healthy looking, but at the end of the day it looks to me like that we are ready to continue going higher. That does not mean that we are going to take off to the upside immediately, but I do think that we are going to continue to see buyers on dips. Ultimately, I think that this market goes looking towards the 0.75 handle, which is the next large, round, psychologically significant figure.

AUD/USD Video 07.12.20

If we were to break above the 0.75 handle it opens up the possibility of a move towards the 0.7750 level, possibly even the 0.80 level. That will take some time to get to, but I think that the destination is certainly what people are looking towards. The Australian dollar will continue to get a boost due to the commodity trade going better in a reflation environment. The Federal Reserve will continue to dump digital dollars into the world, showing signs of trying to drive down the value of the greenback.

Ultimately, this is a market that I think will continue to be very noisy but bullish and that being said I have no interest in shorting this pair. In fact, it would not be until we close significantly below the 200 week EMA that I would consider going short, and even then, I would have to seriously take a look at the macroeconomic picture.

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