Australian Dollar Forecast: AUD/USD Five-Week Plunge into Support

Australian Technical Forecast: AUD/USD Weekly Trade Levels

Australian Dollar breaks multi-month consolidation- plunges more than 7% off July high
AUD/USD five-week decline now testing confluent support
Resistance 6607, ~6690, 6816– Support ~6381/93 (key), 6200/10, 6007/45

The Australian Dollar plunged more than 1.4% this week, marking a fifth consecutive weekly decline into fresh yearly lows. The losses take AUD/USD into a major technical confluence at multi-year slope support- risk for downside exhaustion / price inflection in the days ahead. These are the updated targets and invalidation levels that matter on the AUD/USD weekly technical chart.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Aussie setup and more. Join live on Monday’s at 8:30am EST.

Australian Dollar Price Chart – AUD/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; AUD/USD on TradingView

Technical Outlook: In last month’s Australian Dollar Technical Forecast we noted that AUD/USD was trading, “within the confines of a massive multi-month consolidation formation with price faltering into resistance again this month. From at trading standpoint, the medium-term threat remains lower while below the 2022 trendline with the immediate focus on a breakout of the 6607-6816 range for guidance.” A break lower two-weeks later has fueled a decline of nearly 7.7% off the July highs with Aussie now testing confluence support into the close of the week.

The support zone in focus remains 6381/93- a region defined by the October weekly reversal-close and the 78.6% Fibonacci retracement of the 2022 advance (also converges on the 2020 trendline) . A break / weekly close below this threshold would threaten a much steeper decline towards subsequent support objectives at 6200/10 (the 100% extension / 2022 low-week close / 2008 low close) and 6007/45.

Initial weekly resistance now stands at the May low-week close (6607) and is backed by the 52-week moving average (currently 6690). Broader bearish invalidation now lowered to the objective yearly open at 6816.

Bottom line: A five-week decline takes Aussie into a key technical confluence at multi-year slope support. Bears may be vulnerable while above 6380. From a trading standpoint, a good zone to reduce short-exposure / lower protective stops- rallies should be limited to 6607 IF price is heading for a break here with a close below tis support zone needed to mark resumption. I’ll publish an updated Australian Dollar Short-term Outlook once we get further clarity on the near-term AUD/USD technical trade levels.

Australia / US Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Weekly Technical Charts

--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com

Follow Michael on Twitter @MBForex

The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

FOREX.com is a registered FCM and RFED with the CFTC and member of the National Futures Association (NFA # 0339826). Forex trading involves significant risk of loss and is not suitable for all investors. Full Disclosures and Risk Warning. Increased leverage increases risk.

GAIN Capital Group LLC (dba FOREX.com) 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA. GAIN Capital Group LLC is a wholly-owned subsidiary of StoneX Group Inc.