AUD/USD is developing wave C of medium term uptrend - colored red in the chart. Within this wave C there are 5 subwaves, with subwave 5 still developing - they're colored yellow in the chart. The whole upmove is considered corrective wave B of a larger degree provided 1.0031 remains intact.
The price targets above the current level are Fibonacci expansions off 0.9833-0.9930-0.9843 (waves A-B), 0.9843-0.9907-0.9865 (subwaves 1-2), 0.9865-0.9953-0.9920 (subwaves 3-4).
Resistances:
- 1.0000-08 = confluence area of expanded objective point (XOP) and objective point (OP)
- 1.0033 = super expanded objective point (SXOP)
- 1.0062 = XOP
If the price reverses down the nearest supports will be Fibonacci retracements of 0.9843-0.9977.
Supports:
- 0.9926 = .382 retracement
- 0.9910 = .50 ret
- 0.9894 = .618 ret
Overbought/Oversold
Assuming that the medium term trend is up it's preferable to use oversold readings of the Detrended Oscillator in conjunction with Fib resistances (see above). The oversold area is 20-30 pips away and 0.9926 retracement is a bit farther, so stand aside in the meantime.
Read more on how to apply Fibonacci studies to calculate price targets.
