Saturday, 23 September 2023 01:23 GMT

AUD/USD Forex Signal: No End In Sight For The Aussie Plunge

(MENAFN- Daily Forex) Advertisement Heavy swings in the dollar make highly profitable trades

Bearish view

  • Sell the pair and set a take-profit at 0.6300.
  • Add a stop-loss at 0.6525.
  • Timeline: 1-2 days.
Bullish view
  • Set a buy-stop at 0.6520 and a take-profit at 0.6600.
  • Add a at 0.6400.

The AUD/USD price continued its bearish trend as concerns about the Australian and Chinese economies continued. It crashed to a low of 0.6420, which was the lowest level since 2020. The pair has fallen by more than 11% this year.Chinese and Australia growth concerns

The AUD/USD pair has been in a strong bearish trend in the past few months as the US dollar index continued. The dollar index surged to $114 for the first time in more than two decades. This rally was mostly because of the extremely hawkish Federal Reserve and the rising risks in the market.

The Federal Reserve has delivered several rate hikes this year and hinted that it will continue doing so in the coming months. As such, the bank has become more hawkish than the Reserve Bank of Australia (RBA).

There is also a likelihood that the hiking process will continue after the latest American consumer confidence data. These numbers showed that American consumers were getting more upbeat about the American economy. Confidence rose to 108 in September after rising by 103.6 in August.

The AUD/USD pair also crashed as concerns about the Chinese economy continued. According to the World Bank, the economy will lag behind the rest of Asia for the first time in more than 30 years. The bank expect that the economy will grow by 2.8% in 2022 after rising by 8.1% in 2021. The Australian dollar tends to react to activities in China since it is the biggest trading partner.

Meanwhile, analysts expect that the Reserve Bank of Australia (RBA) will hike interest rates by 0.50% in its next week's meeting. If this happens, it will hike the official cash rate to 2.85% from 2.35%. As a result, Australia's bond yields rose to the highest level in years.AUD/USD forecast

The AUD/USD pair has been in a strong bearish trend in the past few weeks. It has moved below the first support of the standard pivot point. The pair has moved below all moving averages and is along the lower line of the Bollinger Bands. It has also moved below the important support at 0.6600.

Oscillators like the MACD and the Relative Strength Index (RSI) have continued falling. Therefore, the pair will likely continue falling as sellers target the key support level at 0.6300.

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