This week, the Australian dollar has shown impressive growth, breaking through the $0.64 mark and sharply recovering from its lows in eleven months. This rise was supported by several factors. Firstly, the Australian currency strengthened due to the decline in the US dollar and US government bond yields, as well as the covering of short positions.
Investors are also looking ahead to the Reserve Bank of Australia’s monetary meeting next week, which is likely to keep rates unchanged for the fourth month in a row. Minutes from the RBA’s latest meeting showed the bank considered raising rates in September but ultimately left them unchanged, requiring more time to assess the impact of previous changes on the economy.
It is important to note that the Australian dollar has come under pressure and is expected to decline 3% by the end of the third quarter, mainly due to the strength of the US economy and tough signals from the US Federal Reserve.
AUD/USD Weekly Forecast October 2 — 6, 2023
The currency pair Australian Dollar to US Dollar AUD/USD ends the trading week near the 0.6479 area. The pair continues to move as part of the development of an aggressive bullish correction and a bearish channel. Moving averages indicate a bearish trend. Prices have broken through the area between the signal lines downwards, which indicates pressure from sellers of the asset and a potential continuation of the fall in the value of the currency pair. At the moment, we should expect an attempt to develop a bullish correction and test the resistance area near the level of 0.6585. Then, a rebound and continuation of the fall of AUD/USD with a potential target below the level of 0.5825 on the foreign exchange market.
An additional signal in favor of a fall in the pair on Forex will be a rebound from the upper border of the bearish channel. The second signal will be a rebound from the downward trend line on the relative strength index (RSI). Cancellation of the option for the AUD/USD currency pair to fall in the current trading week of October 2 — 6, 2023 will be a strong growth and a breakdown of the level of 0.6985. This will indicate a breakdown of resistance and a continued rise in the Australian Dollar on Forex with a potential target at 0.7275. Confirmation of the development of a decline will be a breakdown of the support area and closing of prices below the level of 0.6245.
AUD/USD Weekly Forecast October 2 — 6, 2023 assumes an attempt to develop a bullish correction and test the level of 0.6475. Further, the currency pair continues to decline below the level of 0.5825. A test of the trend line on the relative strength index (RSI) will support the fall of the pair in the current trading week. Cancellation of the downward option will be a strong growth and a breakdown of the 0.6985 area. This will indicate a breakdown of the resistance area and continued growth of the pair with a target above 0.7275.
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