The AUD/USD is trading higher shortly before the U.S. opening. The Forex pair received a boost earlier in the session when Australian retail sales came out better-than-expected. Next up is the U.S. producer inflation report. Traders are looking for an increase of 0.2%. A stronger-than-expected number should be bullish for the U.S. Dollar. A weaker-than-expected report could trigger a surge to the upside.
Daily Technical Analysis
The main trend is up according to the daily swing chart. The uptrend resumed earlier today when buyers took out .7874. The next target is the October 13 main top at .7897. This top may be the trigger point for an even stronger rally since the next top is at .8102.
A trade through .7807 will change the main trend to down.
The main range is .8102 to .7501. Its retracement zone is .7801 to .7872. The AUD/USD has been testing this zone for two weeks. Trader reaction to this zone could determine the near-term direction of the market.
Daily Technical Forecast
Based on the current price at .7868 and the early price action, the direction of the AUD/USD the rest of the session will be determined by trader reaction to the Fibonacci level at .7872.
A sustained move over .7872 will indicate the presence of buyers. This could create the upside momentum needed to overcome the main top at .7897 and the long-term downtrending Gann angle at .7905.
Crossing to the strong side of the uptrending Gann angle at .7941 will put the AUD/USD in an extremely strong position with the next target a long-term downtrending Gann angle at .8003. This is the last potential resistance angle before the .8102 main top.
A sustained move under .7872 will signal the presence of sellers. If sellers come in then look for a break into .7807 then .7801.
Taking out .7801 could drive the AUD/USD into the Fibonacci level at .7746 then the uptrending Gann angle at .7721.
This article was originally posted on FX Empire
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