Volatility, Bollinger Bands, and Fibonacci are some of the key talking points surrounding the recent breakout of the Australian Dollar.
While building approvals for April came in lower, the AUD/USD pair seems to be taking it in stride.
Could this mean a potential pause before the next move for the Aussie? Technical conditions suggest that all eyes should be on AUD/USD.
Despite disappointing building approval data, the Australian Dollar is holding strong on Tuesday. Analysts predict the Reserve Bank of Australia may not alter interest rates during its upcoming monetary policy meeting due to these trends.
On the technical side, the AUD/USD broke out of its three-month range and dropped below the Simple Moving Average based Bollinger Band, indicating volatility and a possible bearish movement.
However, recent modest gains suggest there is potential for a pause or reversal. The Bollinger Band’s widening shows an increase in realized volatility.
AUD/USD strengthened on Memorial Day holiday, hints at potential recovery to 0.66 level. Market conditions are favorable for a rebound after recent breakdown. 0.66 level represents previous consolidation, and market dynamics may impact future trading. Watch for signs of exhaustion near 0.66, as market could fade.
Prepare for a potential decline to the 0.64 level in the market if it reverses its upward trend. This level is considered the target for the downward move and could happen gradually over time.
As uncertainties loom, people tend to seek guaranteed returns and the US dollar is becoming a favorite safe-haven asset.
The 50-Day Exponential Moving Average (EMA) nearing the 0.66 level might lead to significant price volatility. Be on the lookout for a dead cat bounce in the Australian dollar as investors flock to the greenback.
EUR/GBP, GBP/USD and EUR/USD Outlook
EUR/GBP may hit the support level at 0.8650 while UK data talks about job and wage data and May CPI data.
If tightening expectations persist, the currency might drop to the next target of 0.8600/8610.
Meanwhile, GBP/USD stands strong against the dollar with temporary support holding at 1.2275/2300. Stay ahead of the game with the latest in financial news.
The EUR/USD is under pressure around 1.0700 amid stronger US Dollar, with concerns over the US debt deal and a hawkish Fed outlook. Meanwhile, the EU/US sentiment data is awaited.
Resistance at 1.0720 and 1.0750, with potential losses toward 1.0670 and 1.0640 if support at 1.0700 fails.
Euro rebounds from earlier low but unlikely to sustain strength. Inflation data from Germany to be published Wednesday ahead of Eurozone HICP figures on Thursday.
US stock index futures up as markets cheer debt-limit deal. Risk flows could weaken US Dollar and lead to recovery gains in EUR/USD, but Fed rate hike in June may limit upside potential.
The Euro Predictions
Get ready for a possible increase in the Euro’s value! Experts predict that over the next few years, the Euro will experience moderate gains due to steady and sustained economic growth in the Eurozone.
Additionally, the European Central Bank is expected to implement rate cuts at a much slower rate than the US Federal Reserve, providing further support for the Euro’s rise.
By the end of 2023, we anticipate that the Euro will reach 1.08 and then strengthen to 1.14 by late 2024.
All information has been prepared by TraderFactor or partners. The information does not contain a record of TraderFactor or partner’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may read it. Past performance is not a reliable indicator of future performance.