News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Australian Dollar Forecast: Aussie March Lower- AUD/USD Eyes 2021 Low

Australian Dollar Forecast: Aussie March Lower- AUD/USD Eyes 2021 Low

Michael Boutros, Strategist

Australian Dollar Technical Price Outlook: AUD/USD Weekly Trade Levels

  • Australian Dollar technical trade level update - Weekly Chart
  • AUD/USD reversal looks to challenge 2021 range lows
  • Aussie key support into 7563– key resistance back at 7836
Advertisement

The Australian Dollar has plummeted more than 4.8% against the US Dollar off the January highs with the late-February sell-off carrying over into the start of March trade. The reversal off multi-year highs threatens a deeper correction in the weeks ahead – our focus is on a reaction on a test of the yearly range lows just lower. These are the updated targets and invalidation levels that matter on the AUD/USD weekly price chart heading into the close of the year. for an in-depth breakdown of this Aussie technical setup and more.

Australian Dollar Price Chart – AUD/USD Weekly

audusd chart

Chart Prepared by Michael Boutros, Technical Strategist; AUD/USD on Tradingview

Notes:In last month’s Australian Dollar Weekly Price Outlook we noted that the AUD/USD breakout kept, “the broader focus higher in price but the advance may be vulnerable into the close of the month as weekly momentum stretches into multi-year highs.” An outside-week reversal candle off the highs into the February close on building momentum divergence highlighted the threat for Aussie exhaustion with price now attempting to mark a weekly close back below yearly open support at 7701 (note that the yearly high-week close now comes in at 7705).

Weekly support now rests at the yearly opening-range lows at 7563 and is backed closely by basic trendline support extending off the late-April lows- a break / weekly close below this threshold would be needed to suggest a more significant high was registered last month with such a scenario exposing initial support objectives at the May 2017 low-week close at ~7385. Initial resistance steady at 7701/05 with a breach / close above 7836 needed to mark resumption of the broader uptrend.

Bottom line: The Australian Dollar now risks a deeper March correction with the AUD/USD price reversal approaching multi-month uptrend support. From a trading standpoint, look to reduce short exposure / lower protective stops on a stretch towards 7563 / channel support- keep an eye for a larger reaction there IF reached. Ultimately, a larger setback may offer more favorable opportunities with a close back above this week’s highs needed to reassert the broader long-bias. Review my latest Australian Dollar Price Outlook for a closer look at the near-term AUD/USD technical trade levels.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Australian Dollar Trader Sentiment – AUD/USD Price Chart

Australian Dollar Forecast: Aussie March Lower- AUD/USD Eyes 2021 Low
  • A summary of IG Client Sentiment shows traders are net-short AUD/USD - the ratio stands at +1.01 (50.22% of traders are long) – neutralreading
  • Long positions are 11.09% lower than yesterday and 24.57% higher from last week
  • Short positions are2.74% lower than yesterday and 6.47% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests AUD/USD prices may continue to fall. Yet traders are less net-long than yesterday but more net-long from last week and the combination of current positioning and recent changes gives us a further mixed AUD/USD trading bias from a sentiment standpoint.

---

Key Australia / US Data Releases

DFX Economic Calendar

Economic Calendar - latest economic developments and upcoming event risk.

Previous Weekly Technical Charts

--- Written by Michael Boutros, Technical Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES