AUD/USD Forex Technical Analysis – Buyers Need to Overcome Retracement Zone to Shift Momentum to Upside

The AUD/USD is trading higher on Thursday, but upside momentum seemed to slow after the Forex pair tested a key retracement area. The price action was driven by increased demand for risky assets and an upbeat jobs report.

New Jobs growth came in at 16,000 for the recent month, above the 15,300 consensus estimate, while the unemployment rate held steady at a four and a half year low of 5.5%, according to data from the Australian Bureau of Statistics.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, the minor trend changed to up on a trade through .7876 on Thursday. By some measures, a change in the minor trend indicates a change in momentum. However, I think the Aussie has to cross a major retracement zone before we can be more certain.

The main range is .8135 to .7758. Its retracement zone at .7947 to .7991 stopped the rally earlier today at .7966. Trader reaction to this zone will determine the near-term tone of the market.

If .7758 to .7966 becomes the new short-term range then its retracement zone at .7862 to .7837 will become the primary downside target.

Daily Technical Forecast

Based on Thursday’s close at .7945, the direction of the market early Friday will be determined by trader reaction to the 50% level at .7947.

A sustained move over .7947 will signal the presence of buyers. This could create the upside momentum needed to challenge and overtake .7966, followed by .7991.

A sustained move under .7947 will indicate the presence of sellers. The daily chart is wide open to the downside under this level, but it’s going to need some help from a major catalyst to trigger the break needed to drive the market into at least .7862.