AUD/USD Forex Technical Analysis – Strengthens Over .7296, Weakens Under .7252

The Australian Dollar is edging higher on Wednesday, underpinned by the boost in risk sentiment from the victory of Joe Biden in the U.S. presidential elections and on hopes for a coronavirus vaccine.

The Aussie is also being supported by a surge in the New Zealand Dollar after the Reserve Bank (RBNZ) unveiled a new funding facility and reiterated its commitment to keep the cash rate at 0.25% until March 2021. The Kiwi was also supported as traders pared back the chance of negative interest rates in the country.

At 07:37 GMT, the AUD/USD is trading .7306, up 0.0020 or +0.28%.

In other news, Australia Westpac Consumer Sentiment rose 2.5% to 107.7 in November, up from 105.0. That is a seven year high, the strongest reading since November 2013.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .7340 will signal a resumption of the uptrend, while a move through .7345 will reaffirm the uptrend.

The main trend changes to down on a trade through .6991, but due to the 7 to 10 day rule, today’s session begins with the AUD/USD inside the window of time for a closing price reversal top.

The minor trend is also up. A trade through .7253 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is .7340 to .7253. Its 50% level or pivot at .7296 is currently acting like support.

The short-term range is .7414 to .6991. The AUD/USD is currently trading on the strong side of its retracement zone at .7252 to .7202, putting it in a bullish position. This zone should be considered support.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the AUD/USD is likely to be determined by trader reaction to the minor pivot at .7296.

Bullish Scenario

A sustained move over .7296 will indicate the presence of buyers. If this creates enough upside momentum then look for the move to extend into the minor top at .7240, followed by the main top at .7345. This is a potential trigger point for an acceleration to the upside with .7414 the next likely target.

Bearish Scenario

A sustained move over .7296 will signal the presence of sellers. The first downside target is the support cluster at .7253 – .7252. Buyers could come in on this move. If .7252 fails as support then look for the selling to possibly extend into the 50% level at .7202.