AUD/USD Weekly Price Forecast – Australian Dollar Attempting Recovery

The Australian dollar has rallied a bit during the course of the week to recover a bit towards the 0.76 level. Ultimately, this is a market that has seen a bit of a recovery, and of course 0.75 offering support is a good sign. Nonetheless, the market looks as if it still has not recovered from the massive selloff from the previous week, so I believe that this next week could be very crucial. If we can take out the top of the previous week’s candle, then that would be a very bullish sign, perhaps sending this market much higher.

AUD/USD Video 28.05.21

One thing is for sure, if we break down below the bottom of the candlestick from the past two weeks, we could see this market break down significant down towards the 0.71 handle. Yes, it is a market that is very much bullish over the last several months, but this could be the first cracks in the ice, so I need to be very cautious. The Federal Reserve is not necessarily clear as to what they will be doing as far as monetary policy, and therefore I think there will be quite a bit of confusion in this market. I believe at this point in time it is a significant yet open question, so I would expect to see a lot of choppy behavior.

Quite frankly, I think there is a certain amount of momentum just waiting to happen to the downside, but that is only if we get some type of bigger “risk off” type of scenario. For what it is worth, Core PCE figures came out lighter than anticipated on Friday, which could add more precedents to the idea of an economy slowing down.

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