The Australian Dollar is edging higher on Friday with volume a little tight as the currency inches closer to a key resistance area. Prices have been rising for the past eight sessions with support coming from hope. The rally has been driven by a combination of short-covering and aggressive counter-trend buyers.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="At 08:48 GMT, the AUD/USD is trading .7014, up 0.0006 or +0.09%.” data-reactid=”12″>At 08:48 GMT, the AUD/USD is trading .7014, up 0.0006 or +0.09%.
Shorts are covering because expectations have risen for at least one Fed rate cut in late July. Aggressive counter-trend buyers may be betting on a positive outcome from the meeting between U.S. President Trump and Chinese President Xi Jinping at the G-20 summit in Osaka, Japan on Saturday.
Daily Technical Analysis
The main trend is up according to the daily swing chart. However, momentum has been trending higher since the formation of the closing price reversal bottom at .6832 on June 18.
The main trend will change to up on a trade through .7022. There may not be much of a follow-through to the upside, however, because of a major retracement zone.
The trend turns down on a trade through .6832. This is highly unlikely today. However, with the AUD/USD up eight sessions from its last swing bottom, traders should watch for a potentially bearish closing price reversal top.
The main range is .7206 to .6832. Its retracement zone at .7019 to .7063 is the next major upside target. This is potential resistance, but sellers have to come in to make it resistance.
The short-term range is .7022 to .6832. Its retracement zone at .6949 to .6927 is support.
Daily Technical Forecast
Based on the early price action, the direction of the AUD/USD is likely to be determined by trader reaction to the uptrending Gann angle at .6992.
A sustained move over .6992 will indicate the presence of buyers. The first target is the main 50% level at .7019, followed by the main top at .7022.
Taking out .7022 will change the main trend to up. This could trigger an acceleration to the upside with the next target the Fibonacci level at .7063.
The inability to overcome and sustain a rally over .7019 will signal the presence of sellers. This could drive the AUD/USD back into the uptrending Gann angle at .6992.
A failure to hold .6992 will indicate the selling pressure is getting stronger. This could trigger an acceleration to the downside with the next target the short-term Fibonacci level at .6949.
Basically, we’re looking for the AUD/USD to strengthen on a sustained move over .7022 and for it to weaken on a sustained move under .6992.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="This article was originally posted on FX Empire” data-reactid=”41″>This article was originally posted on FX Empire
More From FXEMPIRE:
- Natural Gas Price Prediction – Prices Slip but Rise 5.4% for the Week
- Gold Weekly Price Forecast – Gold markets for massive shooting star
- Weekly Wrap – Geopolitics, Stats and the G20 Summit Provided Direction
- Crude Oil Price Forecast – Crude oil markets quiet on Friday
- Natural Gas Weekly Price Forecast – Natural gas markets recover for the week
- USD/JPY Weekly Price Forecast – US dollar stabilizes for the week