AUD/USD Forecast – Australian Dollar Continues to See Upward Pressure

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has broken above a significant resistance barrier during the trading session on Friday as the jobs number in the United States has disappointed. This suggests that perhaps we are going to see perhaps a handful of rate cuts this year, which is something that a lot of traders have been sniffing out for a while and I think this is just more of the same.

And with that being said, the US dollar has taken it on the chin, not only due to that perception, but the fact that Jerome Powell this week stated that cutting rates later this year would probably make sense. It all ties together quite nicely for a shrinking US dollar. The question, of course, is whether or not the economy can support the Australian dollar as it is highly sensitive to growth and global trade. In general, this is a market that is a good gauge on everything that is going on globally.

So, with all of that being said, I think you have to look at this as a potentially choppy market, but it does look like it’s going to go higher. Given enough time, the 0.69 level is a major resistance barrier that I think is difficult to overcome and therefore I think that’s probably about as high as we go. It’s also possible that with interest rate cuts, we may see a significant sell off if the Federal Reserve seems to be doing it more or less in a panic mode.

Because, after all, if the global economy is falling apart, it does make a lot of sense that traders will continue to run towards the US dollar for safety. So be aware of all of this. I would pay special attention to the 0.66 level on any pullback because if it offers support, that’s a nice buying opportunity. If we break back below there, this then would become a bit of a false breakout. Pay attention to interest rates, that will be your guiding hand.

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