AUD/USD Forex Technical Analysis – Trapped; Weakens Under .7157, Strengthens Over .7182

The Australian Dollar is trading nearly flat on Friday after jumping to a more than three-week high the previous session. Some of the selling pressure is related to Omicron worries that soured sentiment, sinking the risk-sensitive currency and boosting demand for the safe-haven U.S. Dollar.

At 09:28 GMT, the AUD/USD is trading .7169, down 0.0016 or -0.22%. On Thursday, Invesco CurrencyShares Australian Dollar Trust ETF (FXA) settled at $71.27, up $0.08 or +0.11%.

Despite today’s mixed performance, the Aussie is poised for a higher weekly close having survived a bearish brush with the downside as speculators booked profits on long U.S. Dollar positions.

Mixed signals from the Reserve Bank of Australia (RBA) also provided support. Earlier in the week, the RBA insisted it will not be hiking next year, though it is now open to ending bond buying in February rather than May.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .7224 will signal a resumption of the uptrend. A move through .7090 will change the main trend to down.

The minor range is .7090 to .7224. Its pivot at .7157 is currently being tested. The short-term range is .6993 to .7224. Its 50% level at .7108 is also potential support.

On the upside, the nearest resistance is a pair of 50% levels at .7182 and .7212. The main range is .7556 to .6993. If the uptrend resumes then the rally could extend into its retracement zone at .7275 to .7341.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Friday is likely to be determined by trader reaction to .7182 and .7157.

Bullish Scenario

A sustained move over .7182 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into .7212, followed by .7224.

Taking out .7224 will indicate the buying is getting stronger. This could trigger an acceleration to the upside with .7275 to .7341 the next likely upside target area.

Bearish Scenario

A sustained move under .7157 will signal the presence of sellers. This could trigger an acceleration to the downside with the next target .7108, followed closely by .7090.

Taking out the main bottom at .7090 will change the main trend to down. This could trigger an acceleration to the downside with .6993 the next target.