The AUD/USD has experienced additional selling momentum the past few days and has stumbled towards support levels not traded since the middle of November 2020. After reaching a high of nearly 0.80000 in late February, the AUD/USD has essentially traded lower. However the decline had been rather polite until the middle of June. Since then the AUD/USD has also seen turbulent reversals, but a progressive bearish path has remained the dominant feature.
As of this writing the AUD/USD is hovering near the 0.72550 juncture, but it has seen a low early today below the 0.72450 ratio. Technical and fundamental elements seem to be merging together as a sea of nervousness surrounds the Australian dollar. Concerns about another potential widespread coronavirus ‘lockdown’ have certainly caused worry about the damaging effects it could have on the Australian economy and growth outlook.
Traders who are determined to remain sellers may want to take a glance at long term charts in order to contemplate their short term goals for the AUD/USD. If support near the 0.72475 to 0.74000 levels fails to prove adequate, traders may be tempted to aim for the 0.72350 to 0.72300 junctures below. Speculators however are urged not to be overly ambitious with their trading goals. While it may be appropriate to wager on further downside momentum, traders should exercise the ability to cash out winning positions before they vanish into thin air.
When the AUD/USD broke through support near the 0.73300 ratio early yesterday it certainly appears to have set off alarm bells and triggered additional selling momentum. Trading was swift and speculators should remain on the outlook for additional volatility short term, as important junctures come into view which certainly could set off programmed trading software in financial houses if critical ratios are touched.
Speculators cannot be faulted for pursuing more downside price action within the AUD/USD with the perspective the trend remains steadily bearish. However they should be on the lookout for natural reversals higher. What traders may want to do is use the reversals higher that find tough resistance above as an opportunity to wager with selling positions, seeking nearby support levels which have shown an ability to be touched already.
AUD/USD Short Term Outlook:
Current Resistance: 0.72650
Current Support: 0.72400
High Target: 0.72900
Low Target: 0.72100
