Superior broker technology provider since 2010
+1 (315) 675 1086 | Sales@YourOwnBrokerage.com

Australian Dollar Faces Downside Pressure


The measured move of the breakout suggests a potential downward move towards the 0.64 level, which holds historical importance.

  • The Australian dollar experienced a decline during the recent trading session, following through on the selloff from the previous day.
  • As the currency broke through the lower boundary of a significant consolidation range, indications point towards further downward movement.
  • The measured move of the breakout from the consolidation rectangle suggests a potential drop of 200 points, setting the stage for a move down to the 0.64 level.
  • Additionally, the historical significance of the 0.64 level further reinforces the likelihood of this target.
Advertisement

In the event of a rally from current levels, traders should expect the 0.66 level to act as a notable resistance point. Any signs of bullish pressure are likely to encounter significant resistance in that area. Even if a breakout were to occur, the 50-Day Exponential Moving Average, currently positioned just below the 0.67 level, could provide additional resistance. Only a clear breakthrough beyond this zone would warrant taking a rally seriously. In fact, it is anticipated that fading rallies may be a more favorable strategy until the projected target is reached, as there are so many potential bombshells out there. With this, I am very cautious about taking on too much risk at the moment.

It is important to recognize that the Australian dollar’s performance is closely tied to economic uncertainty and the state of commodity markets. While it is often viewed as a proxy for gold, the currency’s trajectory is also influenced by developments in China. Presently, concerns surrounding China’s situation are keeping a lid on the Australian dollar. Consequently, a bearish bias is favored unless there is significant positive news on the macroeconomic front. The US Federal Reserve’s tight monetary policy further contributes to the appeal of the US dollar, reinforcing the downside pressure on the Australian dollar.

In conclusion, the Australian dollar faced a decline as it broke through the lower boundary of a significant consolidation range. The measured move of the breakout suggests a potential downward move towards the 0.64 level, which holds historical importance. Any rallies are likely to encounter resistance at the 0.66 level, with the 50-Day EMA offering additional hindrance near 0.67. The currency’s performance is closely tied to economic uncertainty and China’s situation, supporting a bearish outlook unless positive macroeconomic developments occur. The US Federal Reserve’s monetary policy further strengthens the US dollar, adding downward pressure to the Australian dollar.

AUD/USD chart

Ready to trade our daily Forex analysis? Here’s a list of the best brokers FX trading Australia to choose from.

Leave a Reply

Your email address will not be published. Required fields are marked *

YourOwnBrokerage is a leading Technology & Business Consulting firm with a specialized focus in Fintech industry.


RISK WARNING: Trading products are highly speculative in nature and carries a significant level of risk which may not be suitable for all investors. Please ensure you fully understand the risks involved and only invest money you can afford to lose. Seek advice from an independent adviser if at all unsure as to the suitability of investing in such instruments.


The content of this website must not be construed as personal advice. We recommend that you seek advice from an independent financial advisor.


The information on this website is not directed to residents of certain jurisdictions where such distribution or use would be contrary to local law or regulation.



© 2009 - 2024 YourOwnBrokerage.com. All Rights Reserved.