AUD/USD Technical Outlook
- AUD/USD trading within a downward trend/channel
- Still room to run lower towards the big 7000 level…
- If resistance can keep a lid on the current rise
Australian Dollar Technical Forecast: Downtrend Getting Tested
AUD/USD remains stuck within the confines of a downtrending channel that could see it hitting an important big-picture level at 7000. However, for that to happen we will need to see resistance hold in place here as it gets a thorough testing.
A channel line and the low-end of a month-long range that ended in the middle of this month are in confluence around current levels. It could offer a nice risk/reward spot for would-be shorts should we see momentum let up here soon and turn lower.
Should weakness soon set in, next up on the downside would be the recent low at 7105, but the bigger target looms at the 7000-line. It’s not just a psych level, it was validated numerous times during 2019 and 2020 (see weekly chart below).
For now, looking for a short entry looks prudent with the right price action as described above. Longs don’t hold appeal at this time as strength looks countertrend in nature.
AUD/USD Daily Chart
AUD/USD Weekly Chart
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
