AUDUSD Forecast – Australian Dollar Gives Up Early Gains

AUDUSD Forecast Video for 19.06.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar initially tried to rally during the trading session on Friday, as we threatened to the crucial 0.69 level. By doing so, it looks like we are finally going to see a little bit of gravity in this pair, but I don’t necessarily think it is going to turn the market around completely. The market has gotten a bit parabolic, in several different markets, not just this one, and I do think that a correction needs to happen. After all, markets do not go in the same direction forever.

The currency market looks at the Australian dollar as a “risk on currency”, and therefore I think you need to look at it through the prism of whether or not everybody is buying risk at this point. It’s probably worth noting that we have only had one negative date leading to this one over the last couple of weeks, so I think a pullback toward the 0.68 level makes quite a bit of sense, especially as it was the previous resistant barrier, and therefore a certain amount of “market memory” could come into play here. It was the top of a major consolidation area, but we have now ripped right back through it and shown quite a bit of volatility. Underneath there, we have the 200-Day EMA that offers support near the 0.6754 level, and therefore if we break down below that, I think it would really start to have this market selling off.

The Reserve Bank of Australia had a surprise interest rate hike recently, while the Federal Reserve chose to pause its interest rate hiking cycle, so therefore it does make sense that the Aussie has been bullish recently. However, the Federal Reserve swears up and down that they will be raising rates later in the year, so it’s possible that not only did we rally quite drastically, but we may be trying to carve out an even bigger range. A short-term pullback is the most likely outcome at the moment, and therefore I think we need to pay close attention to how the market behaves near the 0.68 level. The buyers will be trying to get to the 0.70 level.

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