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Oct 09 - 10:55 PM

AUD/USD - COMMENT-AUD/USD May Have Bottomed Amid Extreme Bearish Forecasts

By John Noonan  —  Oct 09 - 08:55 PM

There have been some extremely bearish calls on the fate of the Australian dollar over the past week that may ironically have contributed to the exchange rate bottoming out.

One prediction in a major Click here warned the Aussie could fall as low as 40 cents before any turnaround can be expected.
But the technical outlook isn't nearly as gloomy and trend indicators suggest a short-term bottom is in place.

AUD/USD completed a bullish outside day reversal on Friday following volatile reaction to the strong U.S. non-farm payrolls data.
The bullish signal looked endangered on Monday morning when news Hamas launched an attack against Israel sent investors into safe-haven strategies that involved selling AUD/JPY.

Geopolitical concerns eased during the U.S. session on Monday, allowing Wall Street and key commoditiesto end higher.
The AUD/USD closed 0.41% higher at 0.6410.
The close above the 21-day moving average at 0.6405 suggests the downtrend is exhausted and a short-term bottom is in place at the 0.6286 Oct 3 low.

The AUD/USD has held below the 55-DMA since Aug 1.
A close above that reading, currently at 0.6460, targets the 38.2 Fibonacci retracement of the July-October decline at 0.6518.

For more click on FXBUZ

Refinitiv IFR Research/Market Commentary


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