AUD/USD has finished wave 1.0255-0.9903 (wave A of medium term downtrend - colored red in the chart) and is now developing corrective wave B. The targets of the corrective upmove are Fibonacci retracements of 1.0255-0.9903, and expansions off 0.9903-0.9987-0.9917 (subwaves A-B within wave B of larger degree).
Resistances:
- 1.0001 = objective point (OP)
- 1.0037 = .382 retracement
- 1.0053 = expanded objective point (XOP)
- 1.0079 = .50 ret
- 1.0021 = .618 ret
- 1.0137 = super expanded objective point (SXOP)
If the price reverses and breaks below 0.9903 (top of wave A) the nearest supports will be Fibonacci retracements of 0.9540-1.0255.
Supports:
- 0.9898 = .50 ret
- 0.9813 = .618 ret
Overbought/Oversold
Assuming that medium term trend has changed and now is up, it's preferable to use oversold readings of the Detrended Oscillator or its cross below the zero level to consider long positions. The oscillator is below the zero level and oversold area is 10-20 pips away from the current level - 0.9945-35. This is the level to open long position in case a bottoming signal appears.
Read more on how to apply Fibonacci studies to calculate price targets.
