Home Forex Technical Analysis AUD/USD Forex Technical Analysis – Approaching Main Bottoms at .7020 and .6973, In Window of Time for Reversal Bottom – Yahoo Finance

AUD/USD Forex Technical Analysis – Approaching Main Bottoms at .7020 and .6973, In Window of Time for Reversal Bottom – Yahoo Finance

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The Australian Dollar traded mostly higher on Friday but in a limited range as investors prepared for Tuesday’s Christmas bank holiday. The inside move suggests investor indecision and impending volatility. Remarkably, the Forex pair was able to remain rangebound throughout the session despite another steep plunge in the U.S. stock market and a steep drop in U.S. Treasury yields.

At 2037 GMT, the AUD/USD is trading .7044, up 0.0018 or +0.26%. At 2037 GMT, the AUD/USD is trading .7044, up 0.0018 or +0.26%.

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Daily AUD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The Forex pair is not in a position to change the trend, but it is inside the window of time for a potentially bullish closing price reversal bottom. So over the near-term traders should be careful when shorting weakness. Make sure you have volume on your side and an exit strategy in place.

A trade through .7031 will signal a resumption of the downtrend. The nearest main top is .7247.

The nearest retracement zone resistance comes in at .7163 to .7207. This is followed by another resistance zone at .7213 to .7255. Combining the two retracement zones creates a resistance cluster at .7207 to .7213.

Daily Swing Chart Technical Forecast

Based on Monday’s price action, the direction of the AUD/USD when trading resumes on Wednesday is likely to be determined by trader reaction to .7031.

Bullish Scenario

A sustained move over .7031 will indicate the presence of buyers. If this move creates enough upside momentum, we could see a test of a minor high at .7124. This is followed by the Fibonacci level at .7163.

Bearish Scenario

A sustained move under .7031 will signal the presence of sellers. The first target is the October 20 bottom at .7020. If this price level fails then look for a potential acceleration to the downside with the February 9, 2016 bottom the next likely downside target.

Closing Price Reversal Chart Pattern

Taking out .7031 then turning higher for the session will be a sign that the buying may be greater than the selling at current price levels. This could trigger the start of a 2 to 3 day short-covering rally.

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