FX.co ★ AUD/USD Wave Analysis for October 30, 2012

AUD/USD Elliott Wave
Yesterday the AUD/USD pair was trading in a downward move, impulsive wave (1) (coloured purple) of the bigger wave 3 (coloured blue) was developing. During the Asian and European sessions we could observe sideways movement between 1.0367 and 1.0342 level. Therefore during the early New York session this currency pair did not manage to hold this level and price started pushing lower, reaching a new low at 1.0325 level. Today the AUD/USD pair finished development of the impulsive wave (1) and currently we are at the end of the corrective wave (2) (coloured purple). In accordance with our wave rules and taking into account that the wave 3 should retrace 161.8% of the wave 1, we can define the potential targets with measuring wave 1 with take profit 1 at 1.0269 (127.2% of wave 1) and take profit 2 at 1.0237 (161.8% of wave 1). To reduce the risk, we can use invalidation at 1.0385 level as stop loss.

Support and Resistance
(S3) 1.0299 (S2) 1.0315 (S1) 1.0326 (PP) 1.0342 (R1) 1.0358 (R2) 1.0369 (R3) 1.0385

Trading Forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the downward movement. That is why short positions at level 1.0365 with stop loss 1.0385, take profit 1 at 1.0294, and take profit 2 at 1.0237 are recommended.