AUD/USD Forex Technical Analysis – Momentum Trending Lower with .7292 – .7248 Next Major Target Zone

The Australian Dollar is under a little pressure against the U.S. Dollar early in the session on Monday as investors express caution ahead of a Reserve Bank of Australia speech and jobs data later in the week.

A strong U.S. Dollar is also weighing on the Aussie. The Greenback began picking up strength on Friday after a robust U.S. Producer Price Index (PPI) report encouraged investors to increase bets on an earlier-than-expected tapering by the Federal Reserve.

At 06:24 GMT, the AUD/USD is trading .7344, down 0.0010 or -0.13%.

The price action also suggests investors are pricing in a stronger-than-expected U.S. Consumer Price Index (CPI) report, due to be released on Tuesday.


Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .7222 will change the main trend to down. A move through .7478 will signal a resumption of the uptrend.

The minor trend is down. It turned down earlier in the session when sellers took out last week’s low at .7347. This move shifted momentum to the downside. A trade through .7410 will change the minor trend to up.

The short-term range is .7222 to .7478. The AUD/USD is currency testing its retracement zone at .7350 to .7320.

The main range is .7106 to .7478. Its retracement zone at .7292 to .7248 is the next downside target zone and potential support area. It’s also the last support zone before the main bottom so look for buyers to come in to defend the uptrend.

The minor range is .7478 to .7336. Its retracement zone at .7407 to .7424 is the nearest upside target area.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Monday is likely to be determined by trader reaction to the short-term 50% level at .7350.

Bullish Scenario

A sustained move over .7350 will indicate the presence of buyers. This could lead to a labored rally with potential upside targets .7379, .7407, .7410 and .7424. The latter is a potential trigger point for an acceleration to the upside with .7478 the next likely upside target.

Bearish Scenario

A sustained move under .7350 will signal the presence of sellers. The next downside targets are layered at .7320, .7292 and .7248. The latter is the last potential support before the .7222 main bottom.

Taking out .7222 will change the main trend to down. This is also a potential trigger point for an acceleration to the downside.

For a look at all of today’s economic events, check out our economic calendar.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.