AUD/USD Forex Technical Analysis – Facing Wall of Resistance from .7379 to .7427

The Australian Dollar is inching lower early Monday as traders await several reports from China that could have an influence on the Australian economic outlook. Chinese Fixed Asset Investment, Industrial Production and Retail Sales are expected to come in lower than the previous month.

At 0:26 GMT, the AUD/USD is trading .7358, down 0.0012 or -0.16%.

If the news from China doesn’t move the Aussie then this will indicate investors are focusing on the Reserve Bank of Australia (RBA) Monetary Policy Meeting Minutes due to be released early Tuesday.

The RBA will release minutes of its August 3 board meeting on Tuesday, although they are unlikely to offer up much new. Since that gathering, it has released its quarterly statement on monetary policy and Governor Philip Lowe has appeared for his six monthly grilling before Federal politicians.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, a trade through .7427 will change the main trend to up. A move through .7290 will signal a resumption of the downtrend.

The minor trend is also down. A trade through the minor bottom at .7316 will indicate that the downside momentum is getting stronger.

The minor range is .7290 to .7427. The AUD/USD is currently straddling its 50% level at .7358.

On the upside, resistance is a long-term Fibonacci level at .7379, followed by a short-term retracement zone at .7396 to .7421.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD early Monday is likely to be determined by trader reaction to the minor pivot at .7358.

Bearish Scenario

A sustained move under .7358 will indicate the presence of sellers. If this move can generate enough downside momentum then look for the selling to possibly extend into the minor bottom at .7316.

Bullish Scenario

A sustained move over .7359 will signal the presence of buyers. This could trigger a labored really into .7379 and .7396. Overcoming the latter could trigger a short-term surge into .7421 to .7427.

The daily chart indicates there is plenty of room to the upside over .7427. Therefore, it could be the trigger point for an acceleration to the upside with .7499 to .7503 the next major upside target area.