AUD/USD Price Forecast – Australian Dollar Gives Up Gains at Same Level

The Australian dollar has rallied a bit during the course of the trading session on Tuesday to reach towards the 0.74 level again, but just as we have seen multiple times, the 0.74 level has caused a bit too much in the way of resistance. By doing so, it has formed a less than bullish look, as we continue to chop back and forth. The market has also seen a bit of a “death cross” recently, as longer-term traders will look at that as a significant selling signal. I do not necessarily subscribe to that theory, but it certainly looks as if we are going to run out of momentum on rallies.

AUD/USD Video 04.08.21

The market breaking above the 0.74 level could open up the possibility of a move to the 0.75 handle, which of course is a large, round, psychologically significant figure and where the 50 day EMA as well as the 200 day EMA sits just above. With that being the case, even if we do get a rally in the Aussie, I think that the sellers will jump all over this market in that general vicinity. On the other hand, if we were to turn around a break down below the 0.73 level, then it is likely that the market could open up a move down to the 0.70 level underneath which is a large, round, psychologically significant figure and an area that has caused a lot of noise in the past. Ultimately, this is a scenario that is simply “fading the rallies” overall, and therefore I still like the US dollar as Australia continues to lock itself down and of course the Chinese economy is starting to show cracks as well.

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