The Australian Dollar is trading sharply higher as traders await the outcome of a meeting between President Donald Trump and Chinese Vice Premier Liu He at 18:45 GMT. The face-to-face meeting is being described as a positive sign, which is making the Aussie an attractive currency. A stronger Chinese Yuan is also providing support for the Australian Dollar, which is often viewed as a proxy for China’s economy.
At 17:44 GMT, the AUD/USD is trading .6799, up 0.0037 or +0.55%.
Throughout the session, the AUD/USD has been supported on hopes of progress in U.S.-China talks after U.S. President Trump said, “very, very good negotiation with China”.
Trump also tweeted, “Good things are happening at China Trade Talk Meeting. Warmer feelings than in recent past, more like the Old Days. I will be meeting with the Vice Premier today. All would like to see something significant happen!”
Daily Technical Analysis
The main trend is up according to the daily swing chart. The trend turned up earlier in the session when buyers took out the two main tops at .6774 and .6775. Taking out .6775 was particularly important because it was the high reached immediately after the Reserve Bank of Australia (RBA) cut its benchmark rate on October 1. The main trend will change to down on a trade through .6710.
The short-term range is .6895 to .6671. Its retracement zone at .6783 to .6809 is currently being tested. This zone is controlling the near-term direction of the Forex pair.
Daily Technical Forecast
Based on the early price action, the direction of the AUD/USD the rest of the session on Friday is likely to be determined by trader reaction to the resistance cluster at .6809 to .6811.
Taking out .6811 and sustaining the rally will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the next downtrending Gann angle at .6843. Overtaking this angle could trigger an acceleration into the next downtrending Gann angle at .6869. This is the last potential resistance angle before the .6895 main top.
A sustained move under .6809 will signal the presence of sellers. The first two downside targets come in at .6790 and .6783.
The trigger point for an acceleration to the downside is .6783. Taking out this 50% level with conviction could trigger a steep break into the uptrending Gann angle at .6741, followed by the main bottom at .6710.
This article was originally posted on FX Empire
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