AUD/USD Strengthens Over .7559, Weakens Under .7538

The Australian Dollar is inching higher on Wednesday after hawkish comments from a high ranking U.S. Federal Reserve official wiped out more than half of the currency’s gains in the previous session. That rally was fueled by less-dovish comments from the Reserve Bank of Australia (RBA) early Tuesday.

At 09:03 GMT, the AUD/USD is trading .7583, up 0.0005 or +0.06%. On Tuesday, the Invesco CurrencyShares Australian Dollar Trust settled at $75.15, up $0.36 or +0.48%.

Late Tuesday, the AUD/USD retreated from a 10-month high after Fed Governor Lael Brainard, usually one of the Fed’s more dovish policymakers, pushed for a quick reduction in the central bank’s bloated balance sheet.

Earlier in the session, the Aussie Dollar hit its highest level since June 2021 after the RBA boosted the prospect of policy tightening.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .7661 will signal a resumption of the uptrend. A move through .7456 will change the main trend to down.

The minor range is .7456 to .7661. Its 50% level or pivot at .7558 provided support earlier in the day.

The main support is the long-term Fibonacci level at .7538. This is followed by a support cluster at .7429 – .7413.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Wednesday is likely to be determined by trader reaction to .7558.

Bullish Scenario

A sustained move over .7559 will indicate the presence of buyers. The first upside target is a minor pivot at .7614. Overcoming this level will indicate the buying is getting stronger, which could lead to a retest of this week’s high at .7661.

The high at .7661 is a potential trigger point for an acceleration to the upside with the June 11, 2021 main top at .7776 the next likely target.

Bearish Scenario

A sustained move under .7558 will signal the presence of sellers. Taking out the main Fib at .7538 will indicate the selling is getting stronger. This would make last week’s close at .7499 the next likely target.