AUD/USD Forex Technical Analysis – Bulls Ready to Challenge June 2018 High at .7677, Followed by .7812

The Australian Dollar is trading higher on Wednesday as the U.S. Dollar slumped to multi-year lows against a basket of major currencies as traders looked past a new delay in U.S. fiscal stimulus and upped their bets that additional financial aid for Americans was still likely.

Early in the session, the Aussie hit its highest level in more than 2-1/2 years even though U.S. Senate Majority Leader Mitch McConnell on Tuesday blocked immediate consideration of a measure to increase COVID-19 relief payments to $2,000, adding another twist to the tumultuous negotiations over fiscal stimulus that have gone on for several months.

At 07:38 GMT, the AUD/USD is trading .7653, up 0.0043 or +0.57%.

While there is uncertainty that a bill will be passed at this time, the bullish price action indicates that investors may be looking past it as many expect further erosion in the U.S. Dollar over the near-term because President-elect Joe Biden is expected to push for even more economic support measures.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed early Wednesday when buyers took out the previous high at .7640. The uptrend is safe for now. A trade through .7339 will change the main trend to down.

The minor trend is also up. A trade through .7557 will change the minor trend to down. This will also shift momentum to the downside.

The first minor range is .7462 to .7664. Its 50% level at .7562 is support.

The second minor range is .7339 to .7664. Its 50% level at .7501 is additional support.

Both 50% levels will move up as the AUD/USD moves higher.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD into the close on Wednesday will be determined by trader reaction to yesterday’s close at .7610.

Bullish Scenario

A sustained move over .7610 will indicate the presence of buyers. Taking out the intraday high at .7664 will indicate the buying is getting stronger. This could create the upside momentum needed to challenge the June 6, 2018 main top at .7677.

Overtaking .7677 will put the AUD/USD in a position to eventually challenge the April 19, 2018 main top at .7812.

Bearish Scenario

A sustained move under .7610 will signal the presence of sellers. In the worst case scenario, we could see a plunge into .7562.

Side Notes

A close under .7610 will form a potentially bearish closing price reversal top. If confirmed, this could trigger the start of a short-term correction.

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