AUD/USD Weekly Price Forecast – Australian Dollar Continues Consolidation

The Australian dollar initially rallied during the course of the trading week but give back the gains in order to show signs of hesitation again. At this point, it certainly looks as if we could drift lower, but there is a significant amount of support at the 0.76 level that will almost certainly come into lift the market. Ultimately, if we break down below there then we could get a little bit deeper of a correction but at this point it looks like we are simply killing time to work off massive froth. This is typical behavior, so I suspect that by the middle of next week people will be buying again.

AUD/USD Video 31.05.21

That being said, if we were to break down below the 0.76 handle, it is very possible we could drop down to the 0.74 handle rather quickly. This is a market that will be sensitive to the labor report next Friday, so it might be kind of quiet between now and then. Remember that this pair is highly sensitive to the global reopening trade and of course the overall commodity trade. With this being the case, the market is likely to continue to see a push back to the selling pressure, but that does not mean that it is going to be very easy.

To the upside, the 0.80 level is a major area that we have to pay close attention to as it has been crucial more than once. If we break above that support level, then we could go looking towards the 0.90 level above. Ultimately, this is a market that I think will break out, but obviously we have a lot of work to do.

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