- The Aussie dollar initially pulled back just a bit during the early hours on Tuesday, but then turned around to rally.
- At this point, it looks like the market is trying to get back to the 0.6650 level, an area that has been a bit of a magnet for price.
- If we can break above there, the 0.67 level could in fact be a bit of a target.
- However, if we turn around and pull back from here, it's likely that we could go down to the 0.66 level again or perhaps even the 200-day EMA.
In general, this is a market that I think continues to be very noisy as traders have to focus on the idea of the Federal Reserve and whether or not it's going to tighten its monetary policy, loosen it, or just stand pat.
Going Forward
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As things stand right now, it looks like it's more likely than not going to stand pad, but people are starting to try to price in the idea of one interest rate cut between now and the end of the year. All things being equal, this is a market that I think you were just bouncing around in a fairly well-defined range. If you are in fact a short-term, trader, this is a good pair for you. If you're a swing trader, then you are still waiting for a bit of clarity, something that we just don't have in the Aussie dollar at the moment, which makes sense because we're not really sure about the global economy and how it's going to perform.
Keep in mind that the Australian dollar is likely to continue to move on the latest noise coming out of Asia, and of course the idea of what the Federal Reserve is going to end up doing. There are a lot of questions out there that continue to be asked in the US, so please keep that in mind. Asian growth has been “lumpy” to say the least, and therefore I expect to see more confusion, not less in this AUD/USD pair.
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