AUD/USD Forex Technical Analysis – Trader Reaction to .7733 Sets Tone into Close

The Australian Dollar is trading lower on Monday in a lackluster move as investors prepare for the start of a two-day Federal Reserve meeting on Tuesday and Wednesday. Mixed demand for risky assets is also weighing on the Forex pair as firm Treasury yields continue to hover slightly below a multi-year high.

At 14:57 GMT, the AUD/USD is trading .7737, down 0.0020 or -0.26%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of the closing price reversal bottom on March 9.  A trade through .7621 will signal a resumption of the downtrend. The main trend will change to up on a move through the nearest main top at .8007.

The minor trend is also down. A trade through .7800 will change the minor trend to up. This will confirm the shift in momentum.

The main range is .7564 to .8007. The AUD/USD is currently testing the lower level of its retracement zone at .7733 to .7786. This zone is controlling the near-term direction of the Forex pair.

The short-term range is .8007 to .7621. Its retracement zone at .7814 to .7860 is resistance.

The minor range is .7621 to .7800. Its retracement zone at .7710 to .7689 is potential support. Aggressive counter-trend traders could come in on a test of this zone. They are going to try to form a potentially bullish secondary higher bottom. Trend trading sellers are going to try to take out .7689 in an effort to trigger a retest of the main bottom at .7621.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD into the close at .7733 is likely to be determined by trader reaction to .7733.

Bearish Scenario

A sustained move under .7733 will indicate the presence of sellers. This could trigger a break into .7710 to .7689.

Bullish Scenario

A sustained move over .7733 will signal the presence of buyers. If this is able to generate enough upside momentum then look for the rally to possibly extend into .7786.