The AUD/USD developing corrective wave B against wave A (1.0199-0.9943) of the medium term downtrend - colored magenta in the chart. Within wave B there are subwaves A, B and C which is still developing (colored red in the chart). The targets of the upmove are Fibonacci expansions off 0.9943-1.0016-0.9969, 0.9969-1.0055-1.0017.
Resistances:
- 1.0156-60 = confluence area of expanded objective point (XOP) and super expanded objective point (SXOP)
If the price keeps declining the immediate supports will be Fibonacci retracements of 1.0017-1.0129, and 0.9943-1.0129.
Supports:
- 1.0086 = .382 retracement
- 1.0073 = .50 ret
- 1.0060-58 = confluence area of .618 and .382 retracements
- 1.0036 = .50 ret
- 1.0014 = .618 ret
Overbought/Oversold
Assuming that the medium term trend is up, it's preferable to use oversold readings (15-20 pips away from the current price) of the Detrended Price Oscillator or its cross below the zero level (5-10 pips away).
Read more on how to apply Fibonacci studies to calculate price targets.
