AUD/USD Forex Technical Analysis – May Have Enough Upside Momentum to Challenge .7494 to .7537

The Australian Dollar is trading higher Monday, building on the upside momentum from last week. Increased demand for higher risk assets is the catalyst behind today’s early session rally. Stocks are rising in Asia, following Wall Street’s advance on Friday. U.S. futures are also spiking higher during the pre-market session.

At 0413 GMT, the AUD/USD is at .7462, up 0.033 or +0.46%.

Aussie traders are also reacting to a weaker U.S. Dollar. The Greenback is struggling after U.S. jobs data showed slower-than-expected wages growth, raising questions about the Fed’s ability to follow-through on its plan to raise rates at least two more times this year.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trend turned up on Friday when buyers took out .7425. The new main bottom is .7353. A trade through this level will change the main trend to down.

The main range is .7677 to .7310. Its retracement zone at .7494 to .7537 is the primary upside target.

Daily Swing Chart Technical Forecast

Based on the early trade, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to last week’s high at .7445.

A sustained move over .7445 will signal the presence of buyers. If this move creates enough upside momentum then we should see a test of the main retracement zone at .7494 to .7537.

Sellers could come in on a test of .7494 to .7537. They will be attempting to form a secondary lower top Overtaking the zone, however, will indicate the buying is getting stronger, making the June 6 main top the next likely upside target.

The inability to hold gains over .7445 will signal the presence of sellers. The current short-term range is .7310 to .7465. If the move leads to a retracement then its retracement zone at .7387 to .7369 will become the primary downside target.

Given the current upside momentum, the bulls are going to have to defend .7445 then come in with buying volume strong enough to drive the AUD/USD into at least .7494.