AUD/USD is moving in corrective wave 4 of medium term downtrend – colored magenta in the chart. Potential targets of the corrective wave up are Fibonacci retracements of 1.0091-0.9815 (wave 3), and expansions off 0.9815-0.9922-0.9820.
Resistances:
– 0.9920-27 = confluence area of .382 retracement and objective point, reached already (!)
– 0.9958 = .50 ret
– 0.9986-93 = confluence area of .618 ret and expanded objective point (XOP)
If the price breaks below 0.9815 to continue the downtrend the nearest supports will be Fibonacci expansions off 1.0182-0.9974-1.0091 (waves 1-2 of the med term trend), 1.0091-0.9815-0.9922 (waves 3-4).
Supports:
– 0.9754-51 = confluence area of XOP and contracted objective point (COP)
– 0.9646 = objective point (OP)
Overbought/Oversold
The Detrended Oscillator is at the zero level, confirming flat market. However, assuming that the prevailing trend is down and the upwave is corrective (4), it’s preferable to seek for topping signals to enter short at a Fib resistance (see above) or when the price gets into the overbought – 20 pips to go.
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