AUD/USD is developing subwave 5 (colored orange red in the chart) within wave C (colored red) of the medium term downtrend. The targets of the downmove are Fibonacci expansions off daily waves 1.0182-0.9727-0.9956, hourly 0.9956-0.9711-0.9855 (the red ones), 0.9845-0.9587-0.9701 (subwave 3 and 4), and 0.9701-0.9569-0.9663 (colored yellow).
Supports:
- 0.9548 = contracted objective point (COP)
- 0.9531 = objective point (OP)
- 0.9501 = OP
- 0.9459-54-49 = confluence area of two expanded objective points (XOP's) and OP
If the price reverses up for a correction and breaks above 0.9663 the nearest resistances will be retracements of 0.9855-0.9569.
Resistances:
- 0.9678 = .382 retracement
- 0.9712 = .50 ret
- 0.9746 = .618 ret
Overbought/Oversold
The Detrended Oscillator is slightly below the zero level, it still has some room to move into the oversold, and assuming that the prevailing trend is down it's prefeable to short the market on slight recoveries - either to Fib retracements or when the price gets above the and/or in the oversold (20-30 pips to go).
Read more on how to apply Fibonacci studies to calculate price targets.
