AUD/USD Forecast – Australian Dollar Attempts to Break Out

AUD/USD Forecast Video for 15.12.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has rallied rather significantly early during the Thursday session, showing signs of life and suggesting that perhaps we are going to see an attempt to take off to the upside, but obviously there is a lot of work to do as we are seeing quite a bit of back-and-forth during the session. Ultimately, I think you have to look at this through the prism of whether or not we are going to continue to see “risk on behavior”, and whether or not people are going to price in the Federal Reserve cutting rates quickly.

The counterargument is that perhaps the Federal Reserve is having to cut rates because they see something ugly coming down the road. I don’t think that’s the case, at least that’s not what they believe. Because of this, do not be surprised at all to see this market be a bit jumpy at the moment, but I do think that it is probably only a matter of time before value hunters come in and try to pick up Australian dollars.

Watch the yields in America, because they obviously have a major influence as well, with the idea being that lower yields help owning gold as it does not pay any type of interest. There is a strong longer-term negative correlation between the 2, something that you have to pay close attention to. Ultimately, I think you’ve got a situation where the Australian dollar will try to get to the 0.69 level, but it may not be a shot straight up in the air. Quite frankly, it could be a situation where the market has to chop around from time to time and cause the occasional pullback in order to offer value. It certainly looks as if something has changed for the longer term against the US dollar, and now it looks like 2024 will probably feature a lot of greenbacks selling which is more along the lines of normalcy in the Forex markets as people take on more risk.

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