Australian Dollar Has a Major Reversal

Australian Dollar vs US Dollar Weekly Technical Analysis

The Australian dollar initially tried to rally during the week, especially as the RBA dropped the word “patience” from its statement. Traders are starting to think that the RBA may start to raise interest rates quicker than initially thought, but at this point, the market reversed as the FOMC meeting minutes came out much more hawkish than anticipated. At this juncture, people are starting to look at this more or less as a “risk-on/risk-off” pair again, and if that is going to be the case it makes a lot of sense that the US dollar will recover.

All things being equal, this is a market that is driven by commodities as well, and it is worth noting that several commodities have struggled a bit as of late. Ultimately, the shape of the candlestick does suggest that there are a lot of sellers above, so I would not be surprised at all to see a pullback. The question now is whether or not we can continue to break down from here?

That is of course going to be difficult to deal with, mainly because volatility continues to be a major issue in almost every market that we trade. With that, I do not expect the Aussie dollar to be any different. If we were to turn around and recapture the top of the candlestick on the weekly chart, that would be a very bullish turn of events, but I do not anticipate seeing that anytime soon. With this, I believe that short-term rallies will be sold into.

AUD/USD Technical Analysis Video 11.04.22

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