AUD/USD Forecast Today 18/02:Australian Dollar Drops

(MENAFN- Daily Forex) The Australian dollar drifted a bit lower on Tuesday, as traders are trying to find buyers at lower levels. Ultimately, this is a currency that will outperform many of the other G-10 currencies against the USD/USD

The Australian dollar drifted a bit during the early part of the trading session on Tuesday but looks as if it is trying to turn things around and bounce a bit. It's one of the strongest G10 performers against the US dollar today, despite the fact that it has fallen off in the risk-off mood in equities and other markets.

The market is one that I follow quite closely these days because the Reserve Bank of Australia is likely to tighten interest rates and I think that continues to be the main story here, with this market looking very much like one that is going to buck the trend as it were. I watch to see if it starts to fall apart. This isn't necessarily a reason that I would start selling, but what I think it would do is signify that perhaps if this pair falls, the US dollar should strengthen quite drastically against other currencies Support and Outlook

From a technical analysis standpoint, I'm looking at the 0.6950 level and the 0.69 level both as support. As long as we stay above there, this remains a short-term buy on the dip opportunity, and I think the Australian dollar will do what it can to get to the 0.72 level eventually.

It's probably going to be very choppy and noisy, but ultimately this is a market that I think still has more of an upward bias than anything else at the moment. Even if this market falls apart like I said, I wouldn't be selling the Australian dollar; I'd be selling other currencies against the US dollar.

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