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A couple of major economies are out on holidays today but that doesn’t mean you can’t go ahead with pricing in your positions!

Today I’m looking at AUD/USD and a possible return to a longer-term downtrend.

Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!

And now for the headlines that rocked the markets in the last trading sessions:

Upcoming Potential Catalysts on the Forex Economic Calendar:

China, Japan, Australia, and New Zealand markets out on banking holiday

TSLA delivered record 308,600 vehicles in Q4 2021, higher than 263,026 expected

Evergrande suspends shares in Hong Kong amidst rumors of being ordered to demolish 39 buildings

UK govt asks public sector to test contingency plans for a 25% staff absence scenario

OPEC expects Omicron variant impact to be “mild and short-lived”

Gold steadies near 6-week high as firmer U.S. yields offset Omicron woes

Upcoming Potential Catalysts on the Forex Economic Calendar:

Italy’s manufacturing PMI at 8:45 am GMT
France’s final manufacturing PMI at 8:50 am GMT
Germany’s final manufacturing PMI at 8:55 am GMT
U.K., U.S., and Canada’s markets out on banking holiday
U.S. final manufacturing PMI at 2:45 pm GMT
U.K. BRC shop price index at 12:01 am GMT (Jan 4)
China’s Caixin manufacturing PMI at 1:45 am GMT (Jan 4)

If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.

What to Watch: AUD/USD

AUD/USD 1-hour Forex Chart
AUD/USD 1-hour Forex Chart

AUD/USD has been making pips rain since the start of December, gaining more than 250 pips from its .7000 lows.

Will the bears start the year by extending the Oct-Nov downtrend?

AUD/USD is forming a potential rising wedge pattern on the 1-hour time frame and, based on the consolidation around the .7250 mark, it doesn’t look like the bulls have momentum on their side.

The U.K., U.S., and Canada’s markets are out today but Asian and European traders are lowkey buying U.S. dollars as they price in new Omicron variant-related uncertainties as well as the Fed’s tapering this year.

If AUD/USD trades below the 100 and 200 SMAs then a breakout below the wedge pattern and an extension of the downtrend becomes more likely. Areas of interest like .7125 and .7050 could become intraweek targets.

If traders focus on taking “risky” assets in the next trading sessions, however, then AUD/USD could surpass December’s highs and hit higher inflection points like .7350 or .7425.