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AUD/USD Forex Technical Analysis – Sellers Like .7173 – .7182; Counter-Trend Buyers Eyeing .7083 – .7068

By:
James Hyerczyk
Updated: Dec 9, 2021, 05:28 UTC

The direction of the AUD/USD on Wednesday is likely to be determined by trader reaction to .7118.

AUD/USD

In this article:

The Australian Dollar is trading at its highest level since December 1 on Wednesday amid a pick-up in risk appetite on signs that Omicron may be less severe than other COVID-19 variants, but still vulnerable to existing vaccines.

At 10:33 GMT, the AUD/USD is trading .7133, up 0.0015 or +0.21%. On Tuesday, the Invesco CurrencyShares Australian Dollar Trust (FXA) ETF settled at $70.60, up $0.66 or +0.94%.

Meanwhile, the Reserve Bank of Australia (RBA) said Omicron was not expected to derail the country’s economic recovery. In its policy statement on Tuesday, the RBA was upbeat on the economic outlook as high vaccination rates allowed the lifting of coronavirus lockdowns.

Daily AUD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .6993 will signal a resumption of the downtrend. A move through .7431 will change the main trend to up.

The minor trend is also down. A trade through .7173 will change the minor trend to up. This will shift momentum to the upside.

The minor range is .7173 to .6993. The AUD/USD is currently trading on the strong side of its pivot at .7083, making it support.

The second minor range is .7371 to .6993. Its 50% level at .7182 is the first upside target.

The short-term range is .7431 to .6993. Its retracement zone at .7212 to .7264 is the primary upside target. Since the main trend is down, sellers are likely to come in on a test of this area.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Wednesday is likely to be determined by trader reaction to .7118.

Bullish Scenario

A sustained move over .7118 will indicate the presence of buyers. Taking out the intraday high at .7143 will indicate the buying is getting stronger. This could trigger a surge into the minor top at .7173, followed by the minor pivot at .7182. Sellers could come in on the first test of this area.

Taking out .7182 will indicate the buying is getting stronger. This could trigger a further rally into the short-term retracement zone at .7212 to .7264. Once again, look for sellers on the first test of this area.

Bearish Scenario

A sustained move under .7118 will signal the presence of sellers. This could trigger a hard break into .7083, followed by .7068.

Aggressive counter-trend buyers could come in on a test of .7083 – .7068. They are going to try to form a potentially bullish secondary higher bottom.

If .7068 fails to hold as support then look for the selling to possibly lead to a retest of .6993 – .6991.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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