AUD/USD Forecast – Aussie Rallies Early in The Monday Trading Hours

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has rallied significantly during the trading session on Monday as we have broken above the 0.6650 level quite nicely and now are threatening the 0.67 level. If we can continue this momentum, it’s very possible we could go to the 0.68 level, possibly even as high as 0.6850. While it is bullish, it is stretched. I believe at this point if you truly believe in the Australian dollar, then you probably want to see some type of short-term pullback in order to take advantage of value.

There is an assumption in the world that the Federal Reserve is going to therefore cut rates and send the U.S. dollar lower. That might be true to a point, but really at this juncture, I think you’ve got a situation where. We still remain range bound. Now we’re getting closer to the top. And to be honest, the Australian dollar is not my favorite place to play against the US dollar. I actually would prefer something along the lines of the British pound. But at this point in time, if gold continues to look strong, that might be a bit of a proxy play buying the Australian dollar to follow that. Right now, I wouldn’t short it either. I’m kind of somewhat stagnant and not impressed.

Because when you zoom out on the chart, you can see we really just have gone nowhere for about a year and a half. It’s been choppy. It’s been volatile. If you’re a short-term trader, it can work out, but you’re probably going to be relegated to look for pullbacks on the hourly chart to take advantage of for quick smash and grab types of trades.

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