AUDUSD Forecast – Australian Dollar Tests Support

AUDUSD Forecast Video for 27.04.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar fell a bit during the trading session on Wednesday to test the 0.66 level. As we continue to look forward toward a slowing global economy, it does make quite a bit of sense that we would see the Australian dollar suffer as a result, due to the fact that the Aussie is so highly correlated to the commodity markets, and of course, the global growth situation and use of those commodities. Furthermore, it’s also highly levered to China, which is also tied in with global growth. Remember, China is Australia’s largest customer, so as one goes, so does the other.

If we do break down from here, the 0.6550 level is the absolute low that we broke higher from, and moving below there could send more money into the US dollar and out of the Australian dollar. That could open up a flood of selling, with the next major support level closer to the 0.64 level. Looking at this chart, you can see that we are definitely getting more and more bearish over time, and you could make an argument for a bearish flag forming. I think at this point, you have to look at it through the prism of a market that’s trying to build up enough momentum to break down, but the question will be whether or not we can break below the support level just underneath.

The 50-Day EMA sits at the 0.67 level, which is where we had seen the market breakdown from. If we were to break above there, then we could see the market go looking to the top of the overall range that we have been in, the 0.68 level. That is the 200-Day EMA, and of course, an indicator that a lot of people will be paying close attention to. With that being the case, I think you got a situation where the market will continue to be very noisy, but I also recognize that more likely than not, we will continue to see a lot of selling pressure on rallies, so I think this is more or less a “fade the rally” type of market currently, and may remain so.

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