AUD/USD Forex Technical Analysis – Sustained Move Under .7733 Could Trigger Acceleration to Downside

The AUD/USD is under pressure early Wednesday after Australia’s September quarterly consumer inflation (CPI) came in well below expectations. Investors dumped the Australian Dollar because this news likely eliminates any chance of a Reserve Bank of Australia rate hike over the short-run.

According to the Australian Bureau of Statistics (ABS), headline CPI rose by 0.6% over the September quarter, leaving the change on a year earlier at 1.8%.

Economists were looking for an increase of 0.8%, seeing the year-on-year rate tick up from 1.9% to 2.0%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. The downtrend was reaffirmed earlier today when sellers took out the previous bottom at .7733.

The main range is .7571 to .8124. Its retracement zone is .7847 to .7782. The AUD/USD is currently trading on the weak side of this zone. This is contributing to the downside bias.

Daily Forecast

Based on the current price at .7718 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 short-term downtrending angle at .7737.

A sustained move under .7737 will indicate the selling is getting stronger. The daily chart indicates there is plenty of room to the downside with the next major targets a downtrending Gann angle at .7602 and the July 5, 2017 main bottom at .7571.

Overtaking the downtrending angle at .7737 and sustaining the move will indicate the return of buyers. This could trigger a return rally into the major Fibonacci level at .7782. This is followed by a short-term downtrending angle at .7817.

Watch the price action and read the order flow at .7737 all session. Trader reaction to this angle will tell us if the sellers are increasing control.