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AUDUSD Forecast – Australian Dollar Recovers After Initial Dip

By:
Christopher Lewis
Published: Jun 5, 2023, 13:50 GMT+00:00

The Aussie dollar initially pulled back during the trading session on Monday in Asia and Europe but has turned back around as we open up the United States.

Australian Dollar, FX Empire

In this article:

AUDUSD Forecast Video for 06.06.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has initially fallen during trading on Monday, as we continue to see a lot of concerns around the world when it comes to global growth. This will obviously have a major influence on the Aussie dollar as it has a high correlation to the commodities, and of course the Chinese economy. The markets look as if they are trying to digest a lot of moving targets, not the least of which will be the situation with OPEC cutting production yet again.

Because of this there are a lot of traders out there worried about whether or not they see something truly horrific with the economy, and therefore it does make a certain amount of sense of the US dollar will eventually strengthen again. 50-Day EMA above should offer a bit of resistance, and if we were to break above there, then obviously it would change a lot of different things. On the other hand, if we see signs of exhaustion, I am more than likely going to jump on a short position, as it could show that the market is running back toward the safety of the US dollar. This will be especially true now that the debt ceiling issue seems to be behind us, and therefore people will be looking to buy US Treasuries.

That being said, I would anticipate that the market will continue to be a very noisy place to be, so therefore you need to be cautious about the nonsensical action that we see from day-to-day. After all, regardless of how negative things are in the real world, it’s interesting to see how traders around the world are willing to look past it. Eventually, there will come a reckoning day, and therefore I think we could see a huge move lower. Until then, you will probably continue to see this noisy behavior in this general vicinity, so therefore I think you’ve got a situation where we would more likely than not continue to see a lot of head fakes out there, but eventually we will have to see some type of follow-through.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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