AUD/USD Forex Technical Analysis – Sellers Could Try to Form Secondary Lower Top at .7740

The Australian Dollar is edging higher on Wednesday despite weaker than expected consumer confidence in January. A measure of Australian consumer sentiment slipped from a decade high in January as new as new outbreaks of COVID-19 in Sydney and Brisbane spooked people, though the spread has now been contained with relatively few cases and no deaths, according to Reuters.

At 06:39 GMT, the AUD/USD is trading .7736, up 0.0038 or +0.49%.

The Westpac-Melbourne Institute Index of Consumer Sentiment released on Wednesday fell 4.5% in January, from December, when it rose 4.1%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The main trend changed to down when sellers took out .7666 on Monday. A trade through .7805 will change the main trend to up.

The minor range is .7820 to .7659. Its 50% level at .7740 is a potential upside target. Since the main trend is down, sellers could come in on a test of this level.

The short-term range is .7339 to .7820. If the selling pressure continues then look for the move to possibly extend into its 50% level at .7579.

The major retracement zone support comes in at .7405 to .7308.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD into the close on Wednesday will be determined by trader reaction to .7740. Sellers are going to try to form a secondary lower top following a test of this level.

Bearish Scenario

A sustained move under .7740 will indicate the presence of sellers. If this move creates enough downside momentum then look for a breakdown under .7659 and a possible test of the main bottom at .7643. Taking out this level will reaffirm the downtrend.

Bullish Scenario

A sustained move over .7740 will signal the presence of buyers. If this move generates enough upside momentum then look for the rally to possibly extend into .7805. Taking out this main top will change the main trend to up with .7820 the next upside target.

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