- The Australian dollar has fallen significantly during the trading session on Wednesday as we continue to see a lot of noisy behavior.
- Quite frankly, this is a market that has been sideways for a while, and that probably continues to be the case.
- Although the US dollar has been fairly strong—and that might continue to be a bit of a thorn in the side of the Australian dollar as well as other currencies—the broader range still holds for now.
Support Level Below
The 0.64 level underneath is a significant support level, and as long as we can stay above there, the range holds. But if we were to break down below the 0.64 level, then it is possible that the Australian dollar could really start to sell off. In that environment, the US dollar would likely strengthen against almost everything, not just the Australian dollar.
The Australian dollar could end up being a bit of a harbinger, as it has been an underperformer for quite some time. While other currencies rallied significantly against the US dollar, the Australian dollar jumped higher and then simply went sideways. The Australian dollar is highly leveraged to the Chinese economy and the global economic movement overall.
With that being the case, as long as there are questions about the global tariff and trade situation, the Australian dollar will remain a little bit lackluster due to its sensitivity. Quite frankly, most traders look at the area between 0.64 as the bottom and 0.66 the short-term top. A lot of back and forth is expected, and therefore, range-bound traders may continue to operate in this type of environment.
Ready to trade our AUD/USD Forex forecast? Here’s a list of some of the best Australian forex brokers to check out.