AUDUSD Forecast – Australian Dollar Recovers After Initial Dip

AUDUSD Forecast Video for 15.03.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has initially pulled back a bit during the trading session on Tuesday to show signs of negativity, only to turn around and show signs of life again. Ultimately, this is a market that I think will continue to see a lot of volatility due to the fact that the Federal Reserve has caused an issue where traders expect the central bank to come out and bail everybody out. This is due to the fact that it’s been nothing but liquidity for 14 years, and now inflation has shown up. This is something that most traders have no idea how to deal with, and the Federal Reserve is so far behind the curve that they have lost all credibility.

That being said, I do think that it is only a matter of time before the Australian dollar runs into a bit of a buzz saw when it comes to resistance. The 0.67 level should continue to be important, as the market has recognized it as both support and resistance. The candlestick from the Monday session did pierce the 0.67 level, but we also saw a lot of selling pressure in that area. Just above that area, you can see that there is consolidation lasted for roughly a week before we broke down significantly. I think this is going to continue to be the story, that we have major issues from time to time, and although it certainly looks short term bullish, I think that eventually the selling pressure comes back, as the US dollar should strengthen in this time of trouble.

Breaking down below the bottom of the candlestick for Tuesday would be negative, opening up the possibility of a drop back down to the 0.66 level. Anything below there opens up 0.65, followed by 0.63. It is worth stating that a lot of the trading public believes that the Federal Reserve is going to loosen monetary policy sooner than they say, and therefore we have a high likelihood of sudden and erratic moves when the Federal Reserve refuses to follow suit. With this, I’m looking for signs of exhaustion to start selling again. Position sizing will be crucial to say the least.

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