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AUD/USD Forex Technical Analysis – January 7, 2019 Forecast

By:
James Hyerczyk
Published: Jan 7, 2019, 12:49 UTC

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 steep uptrending Gann angle at .7084.

AUD/USD

The Australian Dollar is trading higher against the U.S. Dollar on Monday. The Aussie is being supported by optimism that the two-day trade talks between the United States and China, which began in Beijing today, will move the two largest economies closer to an end of their on-going trade dispute.

Traders are also reacting to the news that the Peoples Bank of China cut their reserve requirement. This form of stimulus should provide more liquidity for the economy. The dollar is weakening because of Friday’s dovish comments from Fed Chair Jerome Powell.

At 1233 GMT, the AUD/USD is trading .7134, up 0.0014 or +0.20%.

AUD/USD
Daily AUD/USD

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum has been trending higher since the closing price reversal bottom last Thursday. The main trend will change to up on a trade through .7247. A trade through .6764 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The minor trend is up. This also confirms the shift in momentum.

The short-term range is .7247 to .6764. Its retracement zone at .7062 to .7005 is new support. Trading on the strong side of this zone is helping to generate the upside bias.

The main range is .7394 to .6764. The market is currently trading inside its retracement zone at .7079 to .7153. Trader reaction to this zone will determine the near-term direction of the Forex pair.

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 steep uptrending Gann angle at .7084.

Bullish Scenario

A sustained move over .7084 will indicate the presence of buyers. If this generates enough upside momentum then look for the rally to extend into a Fibonacci level at .7153. This is followed closely by a downtrending Gann angle at .7164.

The angle at .7164 is the trigger point for a potential acceleration to the upside with the next target the main top at .7247.

Bearish Scenario

A sustained move under .7084 will signal the presence of sellers. The next two targets are the 50% level at .7079 and the short-term Fibonacci level at .7062.

The Fib level at .7062 is the trigger point for an acceleration to the downside with the next target the 50% level at .7005.

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.

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