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AUD/USD Forex Technical Analysis – Strengthens Over .7090, Weakens Under .7071

By:
James Hyerczyk
Updated: Oct 31, 2018, 23:23 UTC

Based on Wednesday’s price action, the direction of the AUD/USD on Thursday is likely to be determined by trader reaction to the short-term 50% level at .7090.

AUD/USD

The AUD/USD settled lower on Wednesday but inside the previous day’s range. The price action suggests investor indecision and impending volatility. Gains were limited by expectations of rising U.S. interest rates, solid U.S. economic data and weaker-than-expected Australian consumer inflation data. Weak manufacturing data from China also pressured the Aussie.

AUDUSD
Daily AUD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. A trade through .7020 will signal a resumption of the downtrend. A move through .7160 will change the main trend to up.

The minor trend is up. This is why momentum is trending higher.

The minor range is .7160 to .7020. On Wednesday, the Aussie straddled its retracement zone at .7090 to .7107. This zone is controlling the short-term direction of the AUD/USD.

The main range is .7314 to .7020. If the trend changes to up then its retracement zone at .7167 to .7202 will become the primary upside target.

Daily Swing Chart Technical Forecast

Based on Wednesday’s price action, the direction of the AUD/USD on Thursday is likely to be determined by trader reaction to the short-term 50% level at .7090.

A sustained move under .7090 will indicate the presence of sellers. The first downside target is a minor pivot at .7071. If this price fails as support, we could see an acceleration to the downside with the main bottom at .7020 the next likely downside target.

A sustained move over .7090 will signal the presence of buyers. This could trigger a quick rally into the Fibonacci level at .7107. Taking out this level will indicate the buying is getting stronger. This could trigger a rally into this week’s high at .7122. Taking out this level could create the momentum needed to challenge the main top at .7160.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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