The Australian dollar has maintained its July opening-range just above key weekly support with a strong reversal last week threatening a larger recovery in the Aussie. Here are the updated targets and invalidation levels that matter for AUD/USD[1] heading into the close of the month. Review this week’s Strategy Webinar[2] for an in-depth breakdown of this setup and more.
AUD/USD Daily Price Chart
Technical Outlook: In my latest Weekly Technical Perspective on the Australian Dollar[3], we highlighted that price was approaching key support at, “7327- a level defined by the 61.8% retracement of the 2016 advance and the May 2017 swing lows. Note that the median-line of the descending pitchfork formation has continued to govern the lows on a weekly close basis and highlights the risk to the short-side here.”
Two subsequent attempts to close below this threshold have failed and keeps our focus on a break of the July opening-range[4] for guidance with the broader short-bias still risking a larger recovery here. Daily resistance stands at 7425 with a breach / close above targeting 7491/94 backed by the 61.8% retracement / February trendline resistance at 7537.
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AUD/USD 120min Price Chart
Notes: A closer look at price action sees AUD/USD trading within the confines of a newly proposed ascending pitchfork formation[6] extending off the monthly lows. We’re looking for near-term low at 7378 or 7634 to offer possible entries with bullish invalidation set to the low-day close at 7336.
Initial resistance stands
