AUD/USD Forecast: Aussie Dances Around 0.75 Handle – 30 March 2022
We have a couple of important levels to pay attention to, so trade accordingly.
The Australian dollar initially collapsed on Wednesday but then turned around to show signs of life yet again. The 0.75 handle is an area that is going to be very difficult to deal with, but it must be noted that the market did recover quite nicely to show signs of life again. If that is going to be the case, it is likely that we will see noisy behavior at best. This is a market that will move upon risk appetite, as well as the commodity markets. Keep an eye on both in order to see where we are going next.
It will be interesting to see how this plays out, because this is an area that I think will determine the longer-term trend for the Australian dollar going forward. If we can clear the 0.76 handle, we could possibly be entering a “buy-and-hold” regime for the Aussie dollar, allowing it to go as high as 0.78 over the next several months. This will almost undoubtedly be due to inflation, but one also has to keep in mind that the US dollar is considered to be a safe currency, and there are plenty of things to hide from at the moment. Because of this, I think the Aussie dollar will continue to be very difficult to deal with because there will be a constant “push-pull” in this market.
If we were to break down below the lows of the trading session on Wednesday, that would be a sufficient reason to think that this market will break down rather drastically. The market at that point would almost certainly go looking towards the 0.74 handle, where there will be a certain amount of support, extending down to the 0.7375 handle. This would obviously be more “risk-off” than anything else, as it would show a strengthening US dollar.
There have been some rumors of peace in Ukraine, and that helps the idea of a risk currency such as the Australian dollar. Furthermore, the 50-day EMA is starting to turn to the upside and looks ready to break above the 200-day EMA. Ultimately, this is a market that has some decisions to make in the short term, so the next couple of days could be very noisy. We have a couple of important levels to pay attention to, so trade accordingly.