AUD/USD Price Forecast – Australian dollar runs into massive resistance

The Australian dollar has rolled over during the early part of Monday, showing plenty of exhaustion at the 0.70 level, an area that of course has been massive resistance more than once. By showing this again, it tells me that the market still has a lot of work to do to finally break out to the upside, so it’s very likely that what we will see next is more back and forth. This makes a lot of sense, because we still have a lot of jawboning when it comes to the US/China trade situation, and it looks very likely that nothing is going to change in the short term.

AUD/USD Video 11.06.19

The Australian economy has a lot of issues, not the least of which would be the banking and housing sectors. The bubble in the housing sector is starting to burst, and that of course will weigh upon the Aussie dollar. However, with the Federal Reserve stepping to the sidelines and looking more dovish than just a few weeks ago, we could see the greenback suffered just a bit. If that’s going to be the case, we could get a bit of a relief rally here in the Aussie, but I think it will be somewhat muted in comparison to what could happen in other currency pair is as it is so highly levered to China and that situation doesn’t seem to be getting any better anytime soon. In other words, expect a lot of choppiness and back-and-forth but it does look like we are at least trying to form some type of bottoming.

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