AUD/USD Forex Technical Analysis – Overtaking .6759 Signals Closing Price Reversal Bottom

Based on the early price action and the current price at .6728, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to yesterday’s close at .6759. Overtaking and sustaining a rally over .6759 will signal the presence of buyers. This could trigger a dramatic acceleration to the upside with the first target angle coming in at .6822.
James Hyerczyk
Australian Dollar and Coins

The Australian Dollar hit its lowest level in ten years early Wednesday after a surprisingly aggressive 50-basis point rate cut by the Reserve Bank of New Zealand (RBNZ) opened the door to speculation of an earlier than expected rate cut by its Australian counterpart. After hitting a low of .6677 earlier in the session, the Aussie snapped back to regain almost half of its earlier losses before settling into an intraday range.

At 09:22 GMT, the AUD/USD is trading .6728, down 0.0030 or -0.44%.

Bets the Reserve Bank of Australia (RBA) will ease policy jumped after the RBNZ rate cut. Traders are now pricing in a 70% chance Australia’s central bank will cut by 25 basis points in September. Earlier forecasts had October pegged for a rate cut.

Daily AUD/USD

Daily Technical Analysis

The main trend is down according to the daily swing chart. There is no visible support with the next major downside target the March 3, 2009 main bottom at .6285.

The main trend will change to up on a move through .7082. This is highly unlikely. However, the AUD/USD is down 13 sessions from its last main top which puts it well within the window of time for a closing price reversal bottom. The formation of this pattern won’t change the trend to up, but it could trigger a meaningful 2 to 3 day counter-trend rally.

This pattern is important to both trend and counter-trend traders. For trend traders, it will allow you to tighten up your trailing stops in order to shore up more profits from your short sales. To counter-trend traders, this pattern will be the next best thing to getting lucky and picking a bottom.

Daily Technical Forecast

Based on the early price action and the current price at .6728, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to yesterday’s close at .6759.

Bearish Scenario

A sustained move under .6759 will indicate the presence of sellers. They will be trying to defend the trend against a closing price reversal bottom. If successful, then the selling could resume with the first target today’s intraday low at .6677. Taking out this level will bring the AUD/USD closer to the main bottom at .6285.

Bullish Scenario

Overtaking and sustaining a rally over .6759 will signal the presence of buyers. This could trigger a dramatic acceleration to the upside with the first target angle coming in at .6822. Look for sellers on the first test of .6822, but if it’s overcome then this will indicate that short-covering and aggressive counter-trend buying could drive the AUD/USD into at least .6880 over the near-term.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US