AUD/USD Forex Technical Analysis – Walking Down Weekly Gann Angles at .7284 and .7277

The Australian Dollar finished sharply lower last week. The selling was driven by a combination of dovish central bank comments and aversion to risk. Although the Reserve Bank of Australia sounded upbeat about the economy, policymakers agreed that the next rate hike would not likely take place until late 2019, due to concerns about low inflation and stubbornly weak wages. Additionally, investors shed risky currencies in reaction to a plunge in the Turkish Lira, which raised contagion fears over European bank loans.

For the week, the AUD/USD settled at .7295, down 0.0102 or -1.38%.

Weekly Swing Chart Technical Analysis

The main trend is down according to the weekly swing chart. It was reaffirmed last week when sellers took out the last swing bottom at .7310. A trade through .7484 will change the main trend to up.

Weekly Swing Chart Technical Forecast

Based on the price action the last five weeks, the direction of the AUD/USD this week is likely to be determined by trader reaction to a pair of downtrending Gann angles at .7284 and .7277.

A sustained move over .7284 this week will indicate the presence of buyers. This probably won’t be enough to change the trend to up, but it could fuel a short-covering rally with the nearest target angle coming in at .7384. This angle has been guiding the AUD/USD lower since the week-ending July 13.

A sustained move under .7277 will signal the presence of sellers. This angle, moving down at a rate of 0.004 per week from the .7677 top, has been guiding the AUD/USD lower since the week-ending June 8, or for 10 weeks.

If the Forex pair continues to follow this angle lower then we could see a move into the December 23, 2016 main bottom at .7159 by the week-ending September 7.