AUD/USD Forecast: AUD Forms an Inverted Hammer
You may be better served shorting something else against the dollar.
If the AUD/USD currency pair breaks down below the 0.69 level, it’s possible that the market could go down to the 0.67 level of 0.67 level has been a major support level, and an area where we had bounced from previously. It’s also an area that’s been important multiple times in the past, so it has a lot of historical precedents to it as well. If we were to turn around and break higher, I see a time of areas where you could see potential selling pressure.
Keep in mind that interest rates in America have been all over the place, as the Federal Reserve is looking to tighten monetary policy, and therefore we had seen a surge in the US dollar. However, the market is also going to have to pay close attention to the idea of what the Federal Reserve is going to do, especially at the Jackson Hole Symposium this next week. There will be multiple central-bank figures giving speeches, so buckle up, we are going to see a lot of noisy behavior.
If we do turn around though, the multiple levels that we have to pay attention to include the 50 Day EMA, the 0.70 level, and the 200 Day EMA where we had recently pulled back from. Ultimately, this is a market that I think continues to see more noise than anything else, and therefore the volatility probably makes the dollar a bit more attractive than anything else. However, you should probably keep in mind that the Aussie dollar has been a bit more resilient than many other of its contemporaries against the greenback, so it’s probably going to put up more of a fight against the greenback than most other currencies. Because of this, one would think that sooner or later it would play “catch up”, but you may be better served shorting something else against the dollar.
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