Australian Dollar, AUD/USD, AUD/JPY, AUD/CAD, EUR/AUD – Weekly Technical Outlook
AUD/USD – Neutral
The Australian Dollar cautiously weakened against the US Dollar this past week, but AUD/USD continues to trade within the boundaries of an Ascending Channel, maintaining the near-term uptrend. On the other hand, prices remain lower after a Shooting Star candlestick formation was confirmed earlier this month. A breakout under the channel could hint at resuming the dominant downtrend.
Such an outcome would expose the 0.7106 inflection point, which could be the next level of key support. Below that is the 0.6991 – 0.7016 support zone, which is composed of lows going back to late 2020. If prices bounce off the floor of the channel’s bottom, that may open the door to resuming the uptrend, with immediate resistance the midpoint of the Fibonacci retracement at 0.7275. Not far above that, AUD/USD will eventually face a falling trendline from 2021.
AUD/JPY – Bearish
The Australian Dollar appears to become increasingly vulnerable against the anti-risk Japanese Yen. AUD/JPY continued to make further downside progress after prices broke under a bearish Rising Wedge chart formation. That has opened the door to extending losses, with immediate support being the 61.8% Fibonacci retracement at 81.092. Clearing the latter exposes the 79.844 inflection point towards the 2021 low. In the event of a turn higher, keep a close eye on the 20-day Simple Moving Average (SMA) which may hold as key resistance.
AUD/CAD – Neutral
The Australian Dollar continues to face selling pressure against the Canadian Dollar, with AUD/CAD back to the 2021 low following losses since the end of December. The 61.8% Fibonacci extension at 0.8978 appears to be immediate support. Taking out the latter may open the door to extending the dominant downtrend towards April 2020 levels and the 78.6% extension at 0.8870. However, positive RSI divergence is present, showing fading downside momentum. This can at times precede a turn higher. Key resistance may be the 0.9114 – 0.9146 inflection zone.
EUR/AUD – Neutral
While the Euro lost ground to the Australian Dollar this past week, EUR/AUD trimmed losses on Friday. Moreover, the pair was unable to pierce the floor of a Symmetrical Triangle chart formation. This could hint at further consolidation for the pair. Immediate resistance appears to be the 1.5865 – 1.5947 inflection zone. Beyond that sits the ceiling of the triangle. A breakout below the formation could hint at extending losses, with key support at 1.5567. Below the latter sit 1.5449 and then 1.5357, the latter of which is the October low.
— Written by Daniel Dubrovsky, Strategist for DailyFX.com
To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter