The AUD/USD has developed wave 1.0045-0.9831 - corrective wave B of medium term downtrend according to wave count (colored magenta in the chart). To confirm wave C break above 1.0045 is needed (top of wave A). Within this wave there are A-B-C subwaves (colored red in the chart) with subwave C still developing. The targets of the upmove are Fibonacci retracements of 1.0255-0.9803, and expansions off 0.9803-1.0076-0.9831, 0.9831-1.0021-0.9888.
Resistances:
- 1.0078-82 = confluence area of objective point (OP) and .618 retracement
- 1.0104 = OP
If the price reverses down the nearest supports will be Fibonacci expansions off 1.0255-0.9803-1.0076, 1.0076-0.9831-1.0021.
Supports:
- 0.9870 = contracted objective point (COP)
- 0.9797 = COP
- 0.9776 = OP
Overbought/Oversold
Assuming that the medium term trend is up it's preferable to use oversold readings of the Detrended Oscillator or its cross below the zero level. The Oscillator is now above the zero so now is not the time to open longs. It's better to consider longs when the price gets below the zero (0.9965) or into the oversold (0.9950-40).
Read more on how to apply Fibonacci studies to calculate price targets.
