The AUD/USD pair plunged after reaching 0.7244. It has dropped to as low as 0.7162 where it has found support. It was traded at 0.7216 at the time of writing. Technically, the price action developed a range pattern. Escaping from this formation could bring fresh opportunities.
As you already know, the Reserve Bank of Australia increased the Cash Rate from 0.35% to 0.85% above 0.60% expected. Technically, the bias remains bullish, so the rate could come back higher. Fundamentally, the sentiment could change after the US inflation data publication on Friday.
AUD/USD new range pattern
AUD/USD is trapped between 0.7149 and 0.7282 levels. In the short term, it could continue to move sideways. Dropping below the uptrend line, the price was somehow expected to develop a strong drop.
Still, as long as it stays above the 0.7149 key support, the bias remains bullish. The price could come back higher o test and retest the near-term resistance levels before bringing new opportunities.
AUD/USD forecast
A new higher high, a valid breakout through the 0.7282 brings new long opportunities and signals further growth. This scenario could take shape if the Dollar Index drops deeper.
Staying below 0.7282 and under the uptrend line followed by a new lower low, a valid breakdown below 0.7149 could activate a larger drop and could bring new short opportunities.
