AUD/USD Forex Technical Analysis – January 30, 2019 Forecast

The Australian Dollar is trading higher on Wednesday, underpinned by better-than-expected consumer inflation data, an outlook for a dovish Fed and optimism ahead of the start of high-level U.S.-China trade talks.

Australian consumer inflation beat forecasts last quarter, but core inflation ended 2018 below the central bank’s target band. This reaffirmed the view that interest rates will remain at record lows over the long-run. The Fed is widely expected to leave its benchmark interest rate unchanged. Investors are looking for the central bank to direct remarks toward the balance sheet, patience and data dependence.

US-China trade talks are expected to start with a ray of optimism after U.S. Treasury Secretary Steven Mnuchin said that if China presents enough trade concessions to President Trump, there’s a chance the administration may lift all tariffs. “Everything is on the table,” Mnuchin said early Tuesday during an interview on Fox Business Network.

At 08:22 GMT, the AUD/USD is trading .7193, up 0.0037 or +0.51%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. A trade through .7236 will change the main trend to up. This is followed by another main top at .7247. A trade through .7076 will signal a resumption of the downtrend.

The minor trend is up. A trade through .7205 will reaffirm the uptrend. This is helping to generate the upside momentum. A trade through .7138 will change the minor trend to down. This will shift the momentum to the downside.

The main range is .7394 to .6764. Its retracement zone at .7153 to .7079 is controlling the near-term direction of the AUD/USD. Holding above this zone will help generate an upside bias.

The short-term range is .6764 to .7236. If the main trend changes to down then its retracement zone at .7000 to .6944 will become the primary downside target.

Daily Technical Forecast

Based on the current price at .7193 and 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 downtrending Gann angle at .7194.

Bullish Scenario

Taking out and sustaining the move over .7194 will indicate the presence of buyers. This could create the upside momentum needed to take out the minor top at .7205. At this point, we could see another surge into the main top at .7236 then .7247. Taking out .7247 could trigger an acceleration to the upside with the next target angle coming in at .7294. This is the last potential resistance angle before the .7394 main top.

Bearish Scenario

The inability to sustain a rally over .7194 will signal the return of sellers. If the selling is strong enough then look for a break back into the Fibonacci level at .7153 then the uptrending Gann angle support at .7144.

The selling pressure could increase under .7144 with the minor bottom at .7138 the next target. This is a potential trigger point for an acceleration into the 50% level at .7079 and the main bottom at .7076.