After breaking below the neckline of the head and shoulders pattern on the 4-hour time frame, AUD/USD looks ready to make a quick pullback before resuming its selloff.
The pair found support just around the .9050 to .9100 psychological levels and appears ready to retrace to the .9200 to .9300 area, which is spanned by the Fibonacci retracement levels.
The broken neckline of the reversal pattern lines up with the .9300 handle, which might be the line in the sand for any rallies. An aggressive entry could be set at the .9200 level with a stop above .9300 and aiming for new lows could yield a good return on risk.
By Kate Curtis from Trader’s Way