AUD/USD Forex Technical Analysis – Sellers Could Return Following Test of .7210 to .7258

The Australian Dollar is inching higher early Tuesday as traders await the release of the latest monetary policy decisions by the Reserve Bank (RBA) at 03:30 GMT and the government’s annual budget. Earlier today, ANZ Job Advertisements came in at 7.8%, better than the upwardly revised 2.6% released last month. The Trade Balance came in at 2.64 Billion, worse than the 5.05 Billion forecast and 4.65 Billion previous read.

At 02:16 GMT, the AUD/USD is trading .7191, up 0.0009 or +0.13%.

The RBA is expected to leave rates unchanged at this meeting, but the futures markets are indicating a cut to 0.10% in November is likely.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since September 29. The main trend changes to up on a trade through .7345. A move through .7006 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. A move through the minor top at .7209 will indicate the buying is getting stronger. A trade through .7131 will change the minor trend to down.

The main range is .6777 to .7414. Its retracement zone at .7095 to .7020 is support.

The minor range is .7345 to .7006. The AUD/USD is currently straddling its 50% level at .7175.

The short-term range is .7414 to .7006. Its retracement zone at .7210 to .7258 is the primary upside target. This zone is controlling the near-term direction of the AUD/USD. Since the main trend is down, sellers could come in on a test of this area.

Daily Swing Chart Technical Forecast

Based on the early price action the direction of the AUD/USD on Tuesday is likely to be determined by trader reaction to the 50% level at .7175.

Bullish Scenario

A sustained move over .7175 will indicate the presence of buyers. This could lead to a quick test of a resistance cluster at .7209 – .7210. Overtaking .7210 could trigger an acceleration into the short-term Fibonacci level at .7258.

Bearish Scenario

A sustained move under .7175 will signal the presence of sellers. This could generate the downside momentum needed to challenge the minor bottom at .7131. Taking out this bottom will change the minor trend to down with the main 50% level at .7095 the next likely downside target.