AUD/USD has finished wave 4 (0.9995-0.9953) and is now moving within wave 5 of the medium term uptrend - colored red in the chart. Wave 5 consists of A-B-C subwaves with subwave C still developing - colored yellow in the chart.
The targets above the current level are Fibonacci expansions off 0.9539-1.0031-0.9833 (waves A-B of larger degree), 0.9833-0.9930-0.9843 (waves 1-2), 0.9843-0.9995 (waves 3-4), 0.9953-1.0013-0.9987 (subwave A and B in 5).
Resistances:
- 1.0047 = confluence area of contracted objective point (COP) and objective point (OP)
- 1.0084 = expanded objective point (XOP)
- 1.0097 = super expanded objective point (SXOP)
- 1.0105 = OP
- 1.0137 = COP
- 1.0144 = SXOP
If the price reverses down for a correction the nearest supports will be Fibonacci retracements of the wave up starting from 0.9953 - this wave is not developed yet.
Overbought/Oversold
Assuming that the prevailing trend is up it's preferable to use oversold readings of the Detrended Oscillator in conjunction with Fib supports. The oversold area is 20-25 pips away from the current price.
Read more on how to apply Fibonacci studies to calculate price targets.
