AUD/USD Forex Technical Analysis – Close Over .7330 Forms Potentially Bullish

The Australian Dollar is trading higher late in the session on Wednesday, putting it in a position to post a dramatic closing price reversal bottom. The move does not change the trend to up, but it does shake out some of the weaker shorts who were looking for a bigger payday following this week’s steep sell-off.

At 18:40 GMT, the AUD/USD is trading .7356, up 0.0026 or +0.36%. This is up from an intraday low of .7286.

The Aussie, seen as a liquid proxy for risk appetite, fell to its lowest level since November 2020 before the selling pressure dried up, and short-covering and speculative buying triggered a rebound rally strong enough to turn the AUD/USD higher for the session.



Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .7290 will signal a resumption of the downtrend. A move through .7503 will change the main trend to up.

The first upside target is the long-term Fibonacci level at .7379.

The short-term range is .7503 to .7290. Its retracement zone at .7397 to .7422 is the next upside target area. Since the main trend is down, sellers are likely to come in on a test of these areas.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD into the close on Wednesday will be determined by trader reaction to .7330.

Bullish Scenario

A sustained move over .7330 will indicate the presence of buyers. If this move is able to create enough upside momentum then look for a surge over the intraday high at .7360. This is followed by a long-term Fib level at .7379, a short-term 50% level at .7397 and a short-term Fib level at .7422.

Bearish Scenario

A sustained move under .7330 will signal the presence of sellers. The first downside target is .7325, followed by the intraday low at .7290. If this level fails as support then look for the selling to possibly extend into the November 19, 2020 bottom at .7255.

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

This article was originally posted on FX Empire


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