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AUD/USD Forex Technical Analysis – On-Track for Test of Late September Bottom at .7170

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·2 min read
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  • AUDUSD=X
  • AUD=X
  • USD=X

The Australian Dollar is trading flat early Wednesday after being pressured the previous session by rising U.S. Treasury yields that drove up the appeal of the U.S. Dollar. The catalyst continued to be surging bets on a faster taper rate by the Federal Reserve and a sooner-than-expected rate hike.

This week’s selling pressure is also being fueled by the renomination of Fed Chair Jerome Powell for a second term, who is perceived by market participants to be a hawk at this time in the interest rate cycle.

At 01:19 GMT, the AUD/USD is trading .7223, down 0.0004 or -0.05%.

Daily AUD/USD
Daily AUD/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .7207 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 .7371 will change the main trend to up. This will shift momentum to the upside.

The minor range is .7371 to .7207. Its 50% level at .7289 is the nearest resistance.

The main resistance is the .7318 to .7363 retracement zone. It is controlling the near-term direction of the AUD/USD.

Daily Swing Chart Technical Forecast

The direction of the AUD/USD on Wednesday is likely to be determined by trader reaction to .7227.

Bearish Scenario

A sustained move under .7227 will indicate the presence of sellers. This could trigger a quick break into .7207. This price is a potential trigger point for an acceleration to the downside with the September 29 bottom at .7170 the next likely target.

Bullish Scenario

A sustained move over .7227 will signal the presence of buyers. Taking out .7236 will indicate the buying is getting stronger. If this move creates enough upside momentum then look for the rally to possibly extend into the minor pivot at .7289.

Side Notes

Thursday is a U.S. bank holiday and Friday will likely be treated as one so we could see a steep drop in volume late in the week. Today’s early price action suggests the volume may already be dropping so be careful buying strength and selling weakness.

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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