AUD/USD Forex Technical Analysis – January 24, 2019 Forecast
The Australian Dollar is trading lower on Thursday after erasing earlier gains that were fueled by stronger-than-expected jobs data. The catalyst behind the selling pressure was the news that National Bank said it would raise mortgage rates by 12 to 16 basis points.
The problem with the rate hike is that it comes at a time when the country is facing a real estate debt bubble. The news likely means that household debt will continue to rise, lowering consumption which will weaken the economy enough to fuel a rate cut by the Reserve Bank of Australia later in the year.
At 0434 GMT, the AUD/USD is trading .7112, down 0.0029 or -0.42%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through .7237 will change the main trend to up.
The minor trend is also down. A move through .7167 will change the minor trend to up and shift momentum to the upside.
The main range is .7394 to .6764. The AUD/USD is currently trading inside its retracement zone at .7079 to .7153. This zone is controlling the near-term direction of the Forex pair.
The short-term range is .6764 to .7236. Its retracement zone at .7000 to .6944 is the primary downside target.
Daily Technical Forecast
Based on the earlier price action and the dramatic shift in direction to the downside, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to the short-term downtrending Gann angle at .7146.
Bearish Scenario
A sustained move under .7146 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to extend into the main 50% level at .7079. This is followed closely by the uptrending Gann angle at .7064.
The trigger point for an acceleration to the downside is .7064 with the next target angle coming in at .7034. Taking out this level could extend the selling into the short-term 50% level at .7000.
Bullish Scenario
Overtaking the downtrending Gann angle at .7146 will signal the return of buyers. Since the main trend is down, this could create a labored rally with potential upside targets coming in at .7153, .7167 and .7191.
This article was originally posted on FX Empire
