Advertisement
Advertisement

AUD/USD Forex Technical Analysis – December 21, 2018 Forecast

By:
James Hyerczyk
Published: Dec 21, 2018, 09:00 UTC

Based on the early price action and the previous closes, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to yesterday’s close at .7112.

AUD/USD

The Australian Dollar is trading nearly flat on Friday as investors prepare for the long Christmas holiday week-end after a week of heightened volatility in the financial markets. Aussie traders continue to digest the impact of the Fed’s less-dovish than expected monetary policy decisions on Wednesday, which is helping to keep a lid on prices. Additionally, concerns over the domestic housing situation and consumption as highlighted by the Reserve Bank of Australia’s meeting minutes released earlier in the week are also helping to cap gains.

At 0848 GMT, the AUD/USD is trading .7109, down 0.0002 or -0.02%.

AUDUSD
Daily AUD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .7086 will signal a resumption of the downtrend, but short-sellers should be aware of the possibility of a closing price reversal bottom. Additionally, shorting weakness could be tricky today due to the expected low volume.

The main range is .7020 to .7394. Its retracement zone at .7163 to .7207 is the nearest support. This is followed by an additional resistance zone at .7240 to .7276.

Daily Swing Chart Technical Forecast

Based on the early price action and the previous closes, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to yesterday’s close at .7112.

Bullish Scenario

A sustained move over .7112 will indicate the presence of buyers. If enough buyers show up to generate strong upside momentum then look for the rally to possibly extend into the Fibonacci level at .7363.

Bearish Scenario

A sustained move under .7112 will signal the presence of sellers. This could trigger a retest of this week’s low at .7086. Taking out this level will indicate the selling is getting stronger with the next major target the October 20 bottom at .7020.

Reversal Bottom

Taking out .7086 then closing higher for the session will produce a daily closing price reversal bottom. This won’t indicate a change in trend is imminent, but it could fuel the start of a two-to-three day counter-trend rally.

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.

Did you find this article useful?

Advertisement