AUD/USD technicals heading into today's inflation report...

The Australian dollar, as you can see, outperformed on Tuesday, regaining 0.74 status as the USD softened across the board. H4 price is now seen eyeing resistance at 0.7443, a level that’s provided the market a ceiling on a number of occasions in recent history (see pink arrows). Another interesting point on this timeframe is the potential AB=CD formation (black arrows) that completes around the underside of a daily resistance level at 0.7479 (the next upside target on the daily timeframe).

The story over on the weekly timeframe continues to trade unchanged. Price action shows demand at 0.7371-0.7442 remains in a fragile state. Continued indecisiveness here could open the window to a possible test of the 2016 yearly opening level at 0.7282 sometime down the road. In the event that the bulls regain consciousness, however, a retest of supply at 0.7812-0.7669 may be on the cards.

Areas of consideration:

With traders gearing up for this morning’s Australian inflation data, trading this market technically will likely be a challenge for the time being.

Post news, however, keep tabs on the H4 resistance level mentioned above at 0.7443 for a bounce lower. Likewise, keep eyes on daily resistance at 0.7479. The expectation from here is for price to respect this level and print a notable move lower, given its H4 AB=CD approach and nearby H4 resistance at 0.7491/0.75 handle.

Today’s data points: Australian inflation figures.