AUD/USD Forex Technical Analysis – Reversal Top Could Lead to 2 to 3 Day Correction
The Australian Dollar is trading lower late in the session after hitting its highest level since April 24, slightly below a key retracement zone. The late session weakness has put the currency in a positon to post a potentially bearish closing price reversal top.
At 1811 GMT, the AUD/USD is trading .7580, down 0.0001 or -0.01%.
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Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. However, the price action suggests a closing price reversal top may be forming. The AUD/USD is up nine sessions from its last major swing bottom at .7412 so a reversal top would not come as a surprise.
The main range is .7812 to .7412. Its retracement zone at .7612 to .7659 is the primary upside target. Today’s rally stopped just short of the zone at .7606.
The first short-term range is .7448 to .7606. Its 50% level at .7527 is the first downside target.
The second short-term range is .7412 to .7606. Its retracement zone at .7509 to .7486 is the second downside target.
Since the trend is up, buyers could come in a test of the retracement zones.
Daily Swing Chart Technical Forecast
If a closing price reversal top forms on Tuesday and is confirmed on Wednesday then look for the start of a 2 to 3 day correction with a series of levels at .7527, .7509 and .7486 the primary downside targets.