AUD/USD Forex Technical Analysis – Short-Term Weakness Under .7266, Strength Over .7304

The Australian Dollar is edging lower on Thursday as prices continue to consolidate ahead of Friday’s key speech by Fed Chairman Jerome Powell at the central bankers’ summit at Jackson Hole. Traders are hoping he offers some clues as to the timing of the Fed’s plans to begin tapering monetary stimulus.

At 06:50 GMT, the AUD/USD is trading .7252, down 0.0023 or -0.32%.

Helping to underpin prices is upbeat domestic data. The Aussie is getting some help from data showing Australian business investment beat expectations with a rise of 4.4% in the second quarter, while firms also lifted spending plans for the 2021/22 year.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .7427 will change the main trend to up. A move through .7106 will signal a resumption of the downtrend.

The minor trend is also down. A trade through .7389 will change the minor trend to up. This will also shift momentum to the upside. The current three day rally has been fueled by short-covering, and not a shift in momentum.

The short-term range is .7427 to .7106. Its retracement zone at .7267 to .7304 is resistance. It stopped the rally on Wednesday at .7280.

The minor range is .7106 to .7280. If the downside pressure resumes then look for a pullback into its retracement zone at .7193 to .7172.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Thursday is likely to be determined by trader reaction to .7267.

Bearish Scenario

A sustained move under .7266 will indicate the presence of sellers. If this move can create enough downside momentum over the next two sessions then look for the selling to possibly extend into the retracement zone at .7193 to .7172.

Bullish Scenario

A sustained move over .7267 will signal the presence of buyers. Taking out .7280 will indicate the buying is getting stronger with the next target the Fibonacci level at .7304.

Look for sellers on the initial test of .7304. Besides being resistance, this level is also a potential trigger point for an acceleration to the upside.