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AUD/USD Forex Technical Analysis – February 5, 2016 Forecast

By:
James Hyerczyk
Published: Feb 5, 2016, 09:34 UTC

The AUD/USD is trading flat-to-lower ahead of today’s U.S. Non-Farm Payrolls report. The report is expected to show the economy added 189K new jobs in

Daily AUD/USD

The AUD/USD is trading flat-to-lower ahead of today’s U.S. Non-Farm Payrolls report. The report is expected to show the economy added 189K new jobs in January. This will be below December’s 292K reading. The unemployment rate is expected to come in at 5%. Average Hourly Earnings are expected to show a 0.3% rise. Also at 8:30 a.m. ET, the U.S. Bureau of Economic Analysis is expected to show the Trade Balance increased slightly to -42.9B.

A lower than expected headline reading in the jobs report should lead to more pressure on the U.S. Dollar and solidify expectations that the Fed will refrain from any interest rate hikes in 2016.

Daily AUD/USD
Daily AUD/USD

Technically, the main trend is up according to the daily swing chart. The main range is .7327 to .6826. The market is currently trading on the bullish side of its retracement zone at .7136 to .7094. These levels are new support.

The current rally stalled on Thursday at .7242, creating a minor range with the main bottom at .7002. Its retracement zone at .7122 to .7094 falls inside the main retracement zone, making it a valid downside target.

Based on Thursday’s close at .7198, the direction of the AUD/USD today is likely to be determined by trader reaction to the downtrending angle at .7202.

A sustained move over .7202 will indicate the presence of buyers. The first upside target is yesterday’s high at .7242, followed by a downtrending angle at .7265. This is the last potential resistance angle before the .7327 main top.

A sustained move under .7202 will signal the presence of sellers. The daily chart is open to the downside with the next target the major Fibonacci level at .7136. This is followed closely by the short-term 50% level at .7122.

The daily chart begins to open up under .7122 with potential targets the short-term Fib level at .7094, followed by a potential support cluster at .7077 to .7076.

Watch the price action and read the order flow at .7202 today. Trader reaction to this angle will tell us if the bulls or the bears are in control. Look for volatility with the release of the jobs data at 8:30 a.m. ET.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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