The AUD/USD currency pair fell sharply during the trading session on Tuesday and is now well below the 0.67 level. The market looks likely to go down to the 0.6650 level, which is an area that has seen a lot of previous support. A breakdown below this level could lead to a drop to the 0.6450 level. Additionally, the market recently experienced the "death cross," when the 50-Day EMA breaks down below the 200-Day EMA, which is seen as a negative turn of events. As a result, the market will continue to be more dollar-positive than anything else as long as the Federal Reserve remains "tighter for longer."
Rallies will likely be sold into at the first signs of exhaustion, as the Australian dollar is a very sensitive currency when it comes to global growth and the Chinese mainland, both of which are a bit shaky at the moment. Despite the fact that Chinese numbers are less than desirable at times, they still play a significant role in the performance of the Australian dollar.
A Breakdown Is on the Way
The size of the candlestick suggests that there is a significant amount of downward pressure building in the market, indicating that a breakdown is only a matter of time. Therefore, rallies at this point will more likely than not be sold into at the first signs of exhaustion.
- All things being equal, the US dollar continues to be one of the favorite currencies around the world.
- Therefore, the Australian dollar will continue to be threatened by the strong US dollar.
- It would take the market breaking above the 200-Day exponential moving average for the outlook to change, but currently, the market looks likely to continue falling.
In conclusion, the Australian dollar fell sharply during the trading session on Tuesday and is now well below the 0.67 level. The market looks likely to go down to the 0.6650 level, which is an area that has seen a lot of previous support. The recent "death cross" is seen as a negative turn of events, and as long as the Federal Reserve remains "tighter for longer," the market will continue to be more dollar-positive than anything else. Rallies will likely be sold into at the first signs of exhaustion, and the Australian dollar will continue to be threatened by the strong US dollar. The market looks likely to continue falling, and a breakthrough above the 200-Day EMA is needed for the outlook to change.
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