AUD/USD Forex Technical Analysis – Pair of Main Bottoms at .6800 and .6754 Next Downside Targets
The Australian Dollar closed lower on Friday, taking out the previous session low and signaling the selling pressure is getting stronger. The move also erased the previous session’s gains that were fueled by better-than-expected labor market data. The price action indicates that traders have shifted their focus from economic data and central bank activity to growing concerns over the spreading of the coronavirus.
On Friday, the AUD/USD settled at .6826, down 0.0022 or -0.32%.
We’re looking for a lower opening on Monday with the Aussie closing at its lowest level in over a month Friday. At this time, the Australian economy is vulnerable to the fallout of both bushfires raging within the country, and the coronavirus outbreak in China.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through the next main bottom at .6800 will reaffirm the downtrend. A trade through .6934 will change the main trend to up.
The minor trend is also down. A trade through .6879 will change the minor trend to up and shift momentum to the upside.
The main range is .7082 to .6671. It retracement zone at .6877 to .6925 is controlling the near-term direction of the AUD/USD. This zone is now resistance.
Short-term Outlook
Given the downside momentum into the close on Friday, we’re looking for a lower opening on Monday. Taking out .6800 could trigger an acceleration into the uptrending Gann angle at .6771. Taking out this angle is likely to extend the selling into another main bottom at .6754.
On the upside, the resistance angle that has been guiding the market lower since December 31 drops in at .6862. This angle is the nearest resistance.
The price cluster at .6877 to .6879 is additional resistance.
This article was originally posted on FX Empire
