The Australian Dollar is edging higher on Tuesday, bucking the weaker trend in the global financial markets. Traders also seem to be shrugging off concerns over U.S.-China trade relations that appear to be having a slightly negative effect on higher-risk assets.
Helping to underpin the Aussie is a slightly stronger Chinese yuan, which found a little traction after the People’s Bank of China (PBOC) set a midpoint rate at a fresh 11-year low but a level that was firmer than expected.
At 09:42 GMT, the AUD/USD is trading .6763, up 0.0014 or +0.21%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. However, momentum has been trending higher since the formation of the closing price reversal bottom at .6677 on August 7.
A trade through .6677 will negate the reversal bottom and signal a resumption of the downtrend.
The minor trend is also down. A trade through .6821 will change the minor trend to up. This will also confirm the shift in momentum.
The minor range is .6677 to .6821. Its 50% level or pivot at .6749 is controlling the short-term direction of the AUD/USD.
The main range is .7082 to .6677. If the minor trend changes to up on a move through .6821 then its retracement zone at .6880 to .6927 will become the primary upside target.
Daily Technical Forecast
Based on the early price action and the current price at .6763, the direction of the AUD/USD on Tuesday is likely to be determined by trader reaction to an uptrending Gann angle at .6757 and a downtrending Gann angle at .6742. Both angles straddle the daily pivot at .6749.
A sustained move over .6757 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the minor top at .6821. Taking out the minor top should trigger a rally into an uptrending Gann angle at .6837.
Crossing to the strong side of the uptrending Gann angle at .6837 will put AUD/USD in a bullish position with the main 50% level at .6880 the next upside target.
A sustained move under .6742 will signal the presence of sellers. This could drive the AUD/USD into a pair of uptrending Gann angles at .6717 and .6697. The latter is the last potential support angle before the .6677 main bottom.
This article was originally posted on FX Empire
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