AUD/USD Forex Technical Analysis – September 29, 2016 Forecast

The AUD/USD is trading lower at 0831 GMT after reaching its highest level since the dramatic closing price reversal top on September 8. The price action suggests a closing price reversal top may be forming, which should come as no surprise since the Forex pair is up 12 days from its last main bottom, putting the market in the window of time for this chart pattern.

TECHNICAL ANALYSIS

The main trend is up according to the daily swing chart. The next upside target is the September 8 top at .7732. This is followed by the August 10 top at .7755.

The short-term range is .7441 to .7709. If the developing selling pressure prevails then look for the start of a near-term break. Its retracement zone at .7575 to .7543 will become the primary downside target.

FORECAST

SELLING PRESSURE APPEARS TO BE BUILDING AGAINST THE AUD/USD. AFTER POSTING A HIGHER-HIGH EARLIER ON THE SESSION, THE INDEX IS NOW TRADING BELOW YESTERDAY’S CLOSE, BELOW THE MID-POINT FOR THE SESSION AND BELOW THE OPENING PRICE. THESE MAY BE THREE SIGNS THAT THE SELLING IS GREATER THAN THE BUYING AT CURRENT PRICE LEVELS.

FURTHERMORE, IF THE UPTRENDING ANGLE FROM THE .7441 MAIN BOTTOM, MOVING UP AT A RATE OF .002 PER DAY FAILS, THEN LOOK FOR THE START OF A STEEP BREAK ESPECIALLY IF THE MOVE IS ACCOMPANIED BY RISING SELLING VOLUME. THIS ANGLE IS AT .7681.

WATCH THE PRICE ACTION AND READ THE ORDER FLOW AT .7681 THE REST OF THE SESSION. TRADER REACTION TO THIS PRICE WILL DETERMINE THE DIRECTION OF THE AUD/USD THE REST OF THE SESSION.

ALSO A CLOSE BELOW .7691 WILL FORM A CLOSING PRICE REVERSAL TOP. THIS COULD TRIGGER THE START OF A 2 TO 3 DAY BREAK WITH THE FIRST OBJECTIVE .7575.