AUD/USD Weekly Price Forecast – Australian Dollar Showing Cracks in the Ice
The Australian dollar has been all over the place during the course of the week, reaching towards the 0.76 handle. The 0.76 handle is an area that has been resistance more than once, so it is very likely that we may struggle a bit to get above there. To the downside, we had pierced the 0.75 handle rather significantly and even the 50 week EMA. That being said, the market was trying to recover on Friday but quite frankly this looks like a market that is in serious trouble, and therefore I think that we will have to pay close attention to multiple things out there.
AUD/USD Video 12.07.21
The first one of course is the lockdown that we continue to see in Australia, which will do nothing to help the overall strength of the currency, and that of course we have seen yields in America drop rather drastically, which is a sign that the greenback could come into significant demand for the safety trade. If we break down below this weekly candlestick, then it is very likely we go looking towards the 0.70 level underneath, and if you look closely at the weekly chart, you can see the massive head and shoulders pattern that has just broken down.
For what it is worth, that head and shoulders pattern measures for a move to somewhere near the 0.7050 level, and therefore I think it all ties together quite nicely. That being said, if we did take out the 0.76 level to the upside, we may go looking towards the 0.7750 level above.
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