AUD/USD Forex Technical Analysis – Key Resistance Zone to Overcome is .7770 to .7826

The Australian Dollar is inching higher on Thursday following a reversal to the upside the previous session. The Aussie traded lower on Wednesday early in the session as economic data raised expectations that policy will remain accommodative for an extended period. In Australia, retail sales figures for March beat expectations, however, the numbers weren’t strong enough to change the outlook for monetary policy.

Lower crude oil prices also weighed on the Aussie, but a strong rally in gold triggered a late session rally, leading to a higher close.

At 02:02 GMT, the AUD/USD is trading .7754, up 0.0003 or +0.04%.

In other news released earlier on Thursday, business conditions and confidence strengthened in the Q1 Business Survey, with both rising to +17 index points. This is well above their long-run averages and broadly mirrors the strength reported in the March monthly survey. Survey indicators improved across the board, suggesting the momentum of the recovery was building in Q1.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, momentum shifted to the downside with the formation of a closing price reversal top on April 20 and its subsequent confirmation on Wednesday.

A trade through .7816 will negate the closing price reversal top and signal a resumption of the uptrend. A trade through the main top at .7849 will reaffirm the uptrend. The main trend will change to down on a trade through .7586.

The minor trend is up. A new minor bottom has formed at .7700. A trade through this level will change the minor trend to down. This will also shift momentum to the downside.

The main range is .8007 to .7532. Its retracement zone at .7770 to .7826 is resistance. This zone stopped the buying at .7816 on April 20.

The short-term range is .7532 to .7816. Its retracement zone at .7674 to .7640 is the next potential downside target and support area.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Thursday is likely to be determined by trader reaction to .7770.

Bullish Scenario

A sustained move over .7770 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for the rally to possibly extend into the minor top at .7816, followed by the Fibonacci level at .7826.

Bearish Scenario

A sustained move under .7769 will signal the presence of sellers. If this move is able to generate enough downside momentum then look for the selling to possibly extend into the minor bottom at .7700, followed by the short-term retracement zone at .7674 to .7640.

For a look at all of today’s economic events, check out our economic calendar.