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AUD/USD Forex Technical Analysis – October 19, 2017 Forecast

The AUD/USD is trading higher shortly ahead of the U.S. Forex opening. Earlier in the session, the Aussie Dollar posted a muted reaction to a government report showing the economy added slightly more jobs in September than forecast and a drop in the unemployment rate. China’s GDP data also wasn’t good enough to trigger a rally.

The Australian Dollar is posting a strong recovery in reaction to a weaker U.S. Dollar and a steep drop in Dow Jones Industrial Average futures, which are down 100 points in the pre-market session.

AUDUSD
Daily AUDUSD

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. A trade through .7897 will indicate the buying is getting stronger.

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The main range is .8102 to .7733. The primary upside target is a retracement zone at .7918 to .7961. Since the main trend is down, we could see sellers show up on a test of this area.

On the downside, the major retracement zone is .7847 to .7822. Inside this area is a short-term retracement zone at .7815 to .7795. All of these levels have provided support at some time during the month of October.

Trading on the strong side of these retracement zones is also helping to give the AUD/USD an upside bias.

Daily Forecast

Based on the current price at .7866 (1108 GMT) and the earlier price action, the direction of the AUD/USD the rest of the session is likely to be determined by trader reaction to the major 50% level at .7847.

A sustained move over .7847 will indicate the presence of buyers. This could trigger the upside momentum to challenge the downtrending angle at .7892. We could see a technical bounce on the first test of this angle. However, look for an acceleration to the upside if this angle is taken out with potential targets at .7897 and .7918.

A sustained move under .7847 will signal the presence of sellers. This could trigger a labored break into an uptrending angle at .7823 and a series of retracement levels at .7815, .7795 and .7782.

Basically, look for a bullish tone today as long as the AUD/USD holds above .7847. Watch for a possible acceleration to the upside if .7892 is taken out with conviction.

This article was originally posted on FX Empire

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