AUD/USD Forecast – Aussie Dollar Pulls Back in Early Wednesday Trading

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar did initially try to rally a bit during the course of the trading session on Wednesday, only to turn around and show signs of weakness. At this point in time, the market is likely to continue to see a lot of support near the 0.6850 level. If we were to break down below there, then the market could really start to break apart and drop rather hard. The question then of course is whether or not we have buyers underneath to continue to push the Aussie higher. We probably do, but this I think has more to do with the US dollar than anything else.

I don’t really think the Australian dollar itself is of much consequence. And when you look at the longer term chart, you can see that we are pulling back from the last vestiges of any type of resistance at 0.69. So, if we turn around and break above the 0.69 level, especially on a daily close, then I think it’s a sign that we are going much higher. On the other hand, if we pull back, then I think a bounce, perhaps somewhere around the 0.6850 level or maybe even the 0.68 level, we probably have traders coming in to pick up cheap Aussie dollars. Anything under there, then I start to question a lot of the premise of the Australian dollar actually breaking out for a longer term move.

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