The Australian Dollar closed lower on Friday after hitting its highest level since July 26 early in the session. The move produced a potentially bearish closing price reversal top. The Aussie spiked higher shortly after the United States and China announced a trade deal. However, prices retreated all session on profit-taking and long liquidation as uncertainty over the details of the trade agreement encouraged investors to trim their long positions.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="On Friday, the AUD/USD settled at .6876, down 0.0031 or -0.45%.” data-reactid=”12″>On Friday, the AUD/USD settled at .6876, down 0.0031 or -0.45%.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .6939 will signal a resumption of the uptrend. The main trend will change to down on a trade through .6800.
On Friday, the AUD/USD formed a closing price reversal top. A trade through .6864 will confirm the chart pattern and shift momentum to the downside. This could trigger the start of a 2 to 3 day correction.
The main range is .7082 to .6671. Its retracement zone at .6876 to .6925 is currently being tested. This zone is controlling the near-term direction of the AUD/USD.
The short-term range is .6754 to .6939. Its retracement zone at .6846 to .6825 is the next downside target. Since the main trend is up, buyers could come in on a test of this zone.
The intermediate range is .6671 to .6939. Its retracement zone is the last support area before the .6671 main bottom.
Daily Swing Chart Technical Forecast
Based on Friday’s close at .6876, the direction of the AUD/USD on Monday is likely to be determined by trader reaction to the main 50% level at .6876.
A sustained move over .6876 will indicate the presence of buyers. If this creates enough upside momentum then look for a fast move into a minor pivot at .6902, followed by .6925 and .6939.
A sustained move under .6876 will signal the presence of sellers. Taking out .6864 could trigger an acceleration into .6846 to .6825.
<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=”36″>This article was originally posted on FX Empire
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