Australian Dollar Q3 Technical Forecast 2020

Australian Dollar – Highlights

  • Commodity weakness might increase the selling pressure in the next few days.
  • 2011 downtrend likely to continue to cap currency potential
  • Double top considered for the daily period proposes a new term downtrend for the AUD/USD.
Free $100 Forex No-Deposit Bonus

The current AUD/USD exchange rate looks poised on a slower trajectory to proceed with the bearish pattern over different time frames indicating a new term reverse might be considered.

The existing double top form on everyday trend is still considered as major resistance at the important 70 handles continues capping the bullish potential.

Zooming out to the weekly view shows the important challenges facing the Australian dollar with 2011 that proved to be somehow insurmountable in the past few attempts.

The monthly momentum studies also indicate that there is an impending decrease as the current momentum indicator continues struggling to break back into optimistic territory.

With this regard, the technical forecast of the AUD is still tilted on the downside entering the 2nd half of this 2020.

AUD/USD Price Forecast 2020

There is this popular fact that Australia gets cold when China sneezes. Being the producer, this country relies on its Asian friend to maintain its economy alive because a huge number of its exports get shipped to China.

Australian-Dollar-Price-Outlook

The Australian economy was really affected by the trade war that occurred between Washington and Beijing. The same case applied to USD/AUD, which collapsed in the month of October (one decade low of 0.6670). This was quite unfortunate because the two had topped in January of the year 2018 (0.8135) before the trade war emerged. Though, it is difficult to say whether RBA participated as well. Policymakers wanted Aussie to be less costly, though it should not be at their expense.

AUSTRALIA ECONOMY STILL IN TROUBLE

The economy of Australia grew by 0.4% in the 3rd quarter of the year 2019; this was under 0.6% of Q2 and therefore missed the expectation of the market. In those 3 months up to the month of September, government expenditures reduced while the consumption of the household expanded at a very weak pace. The annual growth rate is currently at 1.7%, according to the newest data.

The employment sector has been really affected and it’s due to this reason that led to RBA cutting the rates (record low of 0.75%). There are more plans to cut the rates for 2020. The slow growth of wages has been dragging the economy since December 2013, (2.3%-3% range). From the new data, the growth of wages is nearer to the rock bottom range instead of moving to the top; this is despite the 3 cut rates that were conducted by RBA during this year’s report.

Copyright © 2020. All Rights Reserved. FXDailyReport.Com
Risk Warning: Trading CFDs is a high risk activity and you may lose more than your initial deposit. You should never invest money that you cannot afford to lose. FXDailyReport.com will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets.