AUD/USD Forecast: Aussie continues to suffer amid risk aversion, RBA decision eyed
|Current Price: 0.6507
- AUD/USD trades at lowest levels since March 2009, weighed by coronavirus fears.
- RBA decision on Tuesday could add further pressure.
The AUD/USD pair extended losses for a second week in a row and hit its lowest level in 11 years at 0.6433 on Friday weighed by the risk aversion environment amid coronavirus concerns. Weaker-than-expected Chinese PMI figures published over the weekend will likely fuel risk aversion and pressure further on the Aussie. While the market is now pricing in a 25 bp cut from the FOMC in March, an RBA cut this week is not ruled out. The RBA last cut was in October when it lowered the cash rate to 0.75% from 1%.
AUD/USD short-term technical outlook
AUD/USD finished the week just above the 0.65 mark, having already corrected oversold readings in the 4-hour chart, which leaves room for further declines. If the pair breaks below its recent low, it could accelerate the fall, with next support at the 0.6400 psychological level. On the other hand, bounces should remain limited by the descending 20 SMA in the 4-hour chart at the 0.6555 zone. Beyond this level, the AUD/USD may aim a steeper correction toward the 100 SMA at 0.6660. However, the main trend remains bearish while elevated volatility is expected to continue.
Support levels: 0.6433 0.6400 0.6344
Resistance levels: 0.6555 0.6590 0.6660
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.