AUD/USD Forex Technical Analysis – February 12, 2019 Forecast

The Australian Dollar is trading higher on Tuesday after recovering from early session weakness. The Aussie strengthened after the NAB business confidence survey came in better than expected, but then crashed to its lowest level since January 4 when Home Loans data came in lower by 6.1%, well below the -2.0% forecast. However, short-sellers used the news to take profits, leading to a short-covering rally that turned the currency higher for the session.

At 05:25 GMT, the AUD/USD is trading .7077, up 0.0015 or +0.21%. Earlier in the session, the Forex pair touched a low of .7053.

Daily Technical Analysis

The main trend is down according to the daily swing chart. An intraday trade through .7053 will signal a resumption of the downtrend. The Forex pair is in no position to change the main trend to up, but eight days down puts it in the window of time for a closing price reversal bottom. We’ve had the lower-low, now all we need is a close over .7062 to complete the chart pattern.

The minor trend is also down. A trade through .7108 will change the minor trend to up. This will also shift momentum to the upside.

The major retracement zone at .7080 to .7154 is controlling the near-term direction of the Forex pair. Currently, it is acting like resistance.

The main range is .6764 to .7296. Its retracement zone at .7030 to .6967 is the primary downside target. Since the AUD/USD is in the window of time for a closing price reversal bottom, buyers could return on a test of this zone.

Daily Technical Forecast

Based on the early price action, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to the major 50% level at .7080.

Bullish Scenario

A sustained move over .7080 will indicate the presence of buyers. If this generates enough upside momentum then look for a move into the minor top at .7108. Taking out this level will shift momentum to the upside with the next target a downtrending Gann angle at .7136. Since the main trend is down, sellers are likely to come in on the first test of this angle. However, taking it out could trigger an acceleration to the upside with .7154 the next likely upside target.

Bearish Scenario

A sustained move under .7079 will signal the presence of sellers. If this move creates enough downside momentum then look for a move into the uptrending Gann angle at .7044. This is followed closely by the main 50% level at .7030. This is a potential trigger point for an acceleration to the downside with the main Fibonacci level at .6967 the next potential downside target.

Closing Price Reversal Scenario

Another key level to watch the rest of the session is .7062. This is yesterday’s close. Since the AUD/USD is in the window of time for a potentially bullish closing price reversal bottom, trader reaction to this level could set the tone of the market for the rest of the session. A close over this level could trigger the start of a 2 to 3 day counter-trend rally.

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