AUD/USD Forex Technical Analysis – September 25, 2017 Forecast

The AUD/USD is trading marginally higher early Monday as investors continue to digest last week’s U.S. Federal Reserve’s decisions which indicated a more hawkish tone by the central bank than expected. Not only did the Fed announce it would begin reducing its balance sheet in October (a form of tightening), but it also left open the possibility of a third rate hike before the end of the year.

Aussie traders may also be reacting to the outcome of the New Zealand elections which pressured the Kiwi after no single party won a majority in an election over the weekend.

Daily Technical Analysis

The main trend is down according to the daily swing chart. The trend turned down last week when the AUD/USD crossed the .7939 swing bottom. A trade through .8102 will change the main trend to up.

A trade through .7908 will signal a resumption of the downtrend. This could lead to a move into a pair of main bottoms at .7871 and .7866.

The major retracement zone support comes in at .7847 to .7782.

The intermediate retracement zone is .7966 to .7928. The AUD/USD is currently straddling this zone.

The new short-term range is .8102 to .7908. If buyers can overcome the intermediate 50% level at .7966 then we could see a rally into the short-term retracement zone at .8005 to .8028.

The retracement zone at .8005 to .8028 is very important. A rally into this zone may attract sellers who are going to try to form a new secondary lower top.

Daily Forecast

Based on the current price at .7953 (0311 GMT) and the earlier price action, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to the 50% level at .7966.

Overtaking .7966 will indicate the presence of buyers. This could lead to a quick move into a downtrending angle at .7982.

Taking out .7982 with conviction could trigger an acceleration to the upside with the first target the short-term retracement zone at .8005 to .8028.

A sustained move under .7966 will signal the presence of sellers. This could trigger a hard break into the Fibonacci level at .7928. This is followed by .7908.

If .7908 fails to hold then look for the selling to continue into the two bottoms at .7871 and .7866.

Watch the price action and read the order flow at .7966 all session. Trader reaction to this level will tell us if the bulls or the bears are in control today.