Australian Dollar Technical Price Outlook: Near-term Trade Levels
- Australian Dollar technical trade level update – Daily & Intraday Charts
- AUD/USD breakout clears confluence resistance – risk for exhaustion into March highs
- Broader outlook constructive while above weekly open support.
The Australian Dollar rallied more than 2% vs the US Dollar since the start of the week with Aussie poised to mark a fifth consecutive daily advance after breaking key resistance on Monday. An advance of more than 18.6% off the yearly lows is now approaching resistance objectives that could limit the rally near-term. These are the updated targets and invalidation levels that matter on the AUD/USD price charts. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Aussie trade setup and more.
Australian Dollar Price Chart – AUD/USD Daily
Chart Prepared by Michael Boutros, Technical Strategist; AUD/USD on Tradingview
Technical Outlook: In my last Australian Dollar Price Outlook we note that price had responded to pivotal resistance zone at, “6417/49- a region defined by the 61.8% retracement of late-December decline and the 61.8% extension of the March Rally.” The pullback held into the close last week with a breakout on Monday keeping the focus higher in Aussie. Daily resistance now stands at the March high-day close at 6585 backed by key resistance at the 2008 low-week close / 100% ext at 6660/87- look for a larger reaction there IF reached.
Australian Dollar Price Chart – AUD/USD 120min
Notes: A closer look at Aussie price action sees AUD/USD trading within the confines of an ascending pitchfork formation with price extending into the 75% parallel today. Initial support rests with the median-line backed by 6448. Near-term bullish invalidation now raised to 6417 with break below the weekly open at 6380 risking a more significant correction in Aussie.
Bottom line: The Australian Dollar breakout may be vulnerable heading into these next topside resistance objectives but trade remains constructive while within this formation. From at trading standpoint, look to reduce long-exposure / raise protective stops on a stretch towards the upper parallel- on the lookout for topside exhaustion. Losses should be limited to 6417 IF Aussie is indeed heading higher. Review my latest Australian Dollar Weekly Price Outlook for a closer look at the longer-term AUD/USD technical trade levels
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy
Australian Dollar Trader Sentiment – AUD/USD Price Chart
- A summary of IG Client Sentiment shows traders are net-short AUD/USD - the ratio stands at -1.35 (42.53% of traders are long) – weak bullish reading
- Long positions are 1.13% higher than yesterday and 17.75% higher from last week
- Short positions are9.85% higher than yesterday and 0.38% higher from last week
- We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests AUD/USD prices may continue to rise. Yet traders are more net-short than yesterday but less net-short from last week. The combination of current positioning and recent changes gives us a further mixed AUD/USD trading bias from a sentiment standpoint.
| Change in | Longs | Shorts | OI |
| Daily | 2% | 3% | 2% |
| Weekly | 29% | -46% | 0% |
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- Written by Michael Boutros, Currency Strategist with DailyFX
Follow Michael on Twitter @MBForex
