AUD/USD Forex Technical Analysis – May 5, 2017 Forecast

Support for the AUD/USD continues to erode early Friday well ahead of the release of the April U.S. Non-Farm Payrolls report. Most of the pressure on the Australian Dollar is being attributed to the strengthening U.S. Dollar and a steep drop in commodities. Traders are also reacting to rising odds of a Fed rate hike in June.

Technical Analysis

The main trend is down according to the daily swing chart.

The main range is .7159 to .7749. Its 50% to 61.8% retracement zone is .7396 to .7476. The AUD/USD is trading on the weak side of this zone, putting it in a bearish position.

Forecast

Based on the current price at .7375 at 0509 GMT, the direction of the AUD/USD on Friday is likely to be determined by trader reaction to the Fibonacci level at .7384 and the uptrending angle at .7394.

A sustained move under .7484 will signal the presence of sellers. This could trigger a break into the steep downtrending angle at .7316.

Crossing to the weak side of the angle at .7316 will put the Aussie in a bearish position and put the market on the path for an eventual move into the next uptrending angle at .7277.

Overcoming .7384 will indicate the presence of buyers. Overtaking the angle at .7394 will signal the buying is getting stronger. This could generate enough upside momentum to challenge the next downtrending angle at .7436.

Look for a possible expansion to the downside if the AUD/USD stays below .7384 and a possible short-covering rally if buyers can overcome .7394.