AUD/USD Forecast – Australian Dollar Pulls Back From the 50-Day EMA Again

AUD/USD Forecast Video for 07.07.23

Australian Dollar vs US Dollar Technical Analysis

The Aussie dollar initially tried to rally during the trading session on Thursday but has found the 50-Day EMA to be a bit too much to overcome. Furthermore, the ADP Employment numbers came out much hotter than anticipated, and therefore people are starting to worry about the overall volatility coming into the Non-Farm Payroll numbers on Friday. Because of this, I think you will continue to see a lot of noisy behavior, but it looks to me like we continue to see a lot of resistance above, as people were worried about whether or not the Federal Reserve will continue to be very tight with its monetary policy. At this point, that does continue to look very likely at this point.

If we were to break above the 50-Day EMA, then it’s possible that the market could go looking to the 200-Day EMA, which is a major indicator that a lot of people pay close attention to. Breaking above that opens up the possibility of a move to the 0.68 level, which of course also offers the possibility of a complete breakout, but I think ultimately, this is a situation where the market will continue to be noisy, but I do think more likely than not have more downward pressure than anything else.

If we were to break down below the 0.66 level, it opens up the possibility of a move down to the 0.65 handle. The 0.65 level is an area where we had seen a major bounce, and if we were to break down below there, it’s likely that we could go down to the 0.64 level, an area that has been important previously, and of course is the “measured move” of the previous consolidation area. All things being equal, you should also keep in mind that the Australian dollar is highly sensitive to commodity pricing and of course the global economy on the whole. With that being the case, I’m very likely to fade short-term rallies until the overall attitude of the market itself changes. With that, be cautious and make sure to keep your position size reasonable, as Friday will obviously be very noisy with the employment figures coming out.

For a look at all of today’s economic events, check out our economic calendar.