Australian Dollar vs US Dollar Technical Analysis
The Australian dollar found itself overextended during the trading session on Wednesday, as we had broken quite significantly above the 0.69 level. That being said, it looks like resistance has returned. This makes quite a bit of sense, considering that there are so many questions when it comes to the global economy right now, and therefore you need to be cautious about taking on too much risk.
The 50 Day EMA is sitting at the 0.6960 level and dropping, so that is starting to come into the picture as well. Because of this, I think it’s probably only a matter of time before we pull back. The question now is whether or not we pull back significantly, or if it’s just the drop before we rally again? It’s worth noting that the area around the 0.67 level is a major support level on longer-term charts, so the bounce should not be a huge surprise. That being said, it is probably worth noting that a move below there could open up the floodgates and cause the Aussie to fall apart.
If we do break to the upside, the 0.70 level will be an area of extreme interest, therefore I think probably difficult to break above. It is at that point we start to ask questions about the trend, but even then, I don’t know that I would be convinced of a complete trend change until we got above the 200 Day EMA, presently sitting at the 0.7170 region and dropping. I think the next couple of weeks are going to be interesting, as it could set the tone for the rest of the year.
AUD/USD Price Forecast Video for 21.07.22
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire