AUDUSD Forecast – Australian Dollar Threatens to Break Out

AUDUSD Forecast Video for 05.04.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has gone back and forth during the trading session on Tuesday, as we are now hanging around the 50-Day EMA. The question is whether or not we are going to break out to the upside, as the 0.68 level has been a bit of a major barrier for some time. The fact that we pierced that level and then turned around suggests that perhaps we aren’t quite ready to go higher. If we break down below the lows of the day, it’s possible that we could go down to the 0.6650 level. That’s where we took off from during the previous session, and therefore one would have to assume there is a significant amount of demand in that region.

The 0.68 level being broken to the upside makes a move toward the 200-Day EMA. If the market were to move above the indicator, then it opens up a longer term uptrend. I would also expect to see a move towards the 0.70 level. I do think this is a situation where the risk appetite will have a lot to do with what happens next, but it’s worth noting that the RBA sat still overnight, so it suggests that perhaps interest rate differentials won’t have much to say.

Keep in mind that the Australian dollar is highly levered to the commodity markets, and of course global growth. At this point, it seems like it’s a bit of a mixed picture across the board, so I think you will continue to see a lot of volatility in this pair. The Australian dollar also represents a certain amount of risk appetite, so you have to be willing to keep that in mind as well. It does make a certain amount of sense that we would consolidate in this area, because it has been so important. However, if we can get a reasonable impulsive candlestick, then it could give you an idea as to which direction we are going, and then it’s simply a matter of following the momentum in this market. The momentum has been contained for a while, and the fact that we reversed after the massive shot higher on Monday suggests that it will remain so.

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