AUD/USD Forex Technical Analysis – Strengthens Over .7814, Weakens Under .7785

The Australian Dollar is edging higher shortly before the release of a key monthly employment report. The reports are important because Reserve Bank of Australia (RBA) policymakers have said that getting the labor market back to full strength is their number one priority.

The early session strength is being generated by follow-through buying tied to the dovish announcements from the U.S. Federal Reserve late Wednesday afternoon. The Fed predicted a fast economic recovery from the coronavirus pandemic and said it would maintain its interest rate at close to zero.

At 0:20 GMT, the AUD/USD is trading .7817, up 0.0018 or +0.23%.

At 0:30 GMT, AUD/USD investors will get the opportunity to react to the latest data on Employment Change, Unemployment Rate and the RBA Bulletin. At 01:05 GMT, RBA Assistant Government Kent is scheduled to give a speech.

The Aussie Employment Change is expected to show the economy added 30.5K jobs in February. The Unemployment Rate is expected to dip to 6.3%. Better-than-expected reports should be bullish for the AUD/USD.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trend turned up on Wednesday when buyers took out .7800. The new main bottom is .7700. A trade through this level will change the main trend to down.

The main retracement zone is .7785 to .7733. This zone is trading on the strong side of this area, giving the AUD/USD an upside bias. This zone is also controlling the near-term direction of the Forex pair.

The short-term range is .8007 to .7621. The AUD/USD is currently testing its retracement zone at .7814 to .7860. Trader reaction to this zone will determine the next move in the market.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Thursday is likely to be determined by trader reaction to the short-term 50% level at .7814.

Bullish Scenario

A sustained move over .7814 will indicate the presence of buyers. The next upside target is .7860. This is a potential trigger point for an acceleration to the upside with .8007 the next major target.

Bearish Scenario

A sustained move under .7814 will signal the presence of sellers. This could trigger a quick break into .7885. Buyers could come in on the first test of this level. If it fails then look for the selling to possibly extend into .7733.

Side Notes

Watch the price action and read the order flow on a test of .7814 to .7860. Aggressive counter-trend sellers may try to stop the rally and form a secondary lower top. Buying are going to try to trigger a breakout over .7860.

For a look at all of today’s economic events, check out our economic calendar.