Technical outlook:
AUDUSD dropped below 0.6930 during the Asian session on Monday after hitting intraday highs close to 0.6960. The currency pair might be unfolding a contracting triangle since printing the 0.7275 high on June 03, 2022. Prices are expected to test the 0.6890 levels before turning higher again in the near term.
AUDUSD might have completed its larger degree corrective wave, which began from the 0.8000 highs as seen on the daily chart here. The correction unfolded as a potential zigzag and might have terminated at around 0.6830 on May 12, 2022. If the above structure holds, prices will remain above 0.6830 and continue higher towards the 0.7660 initial resistance.
Alternatively, the corrective wave might be still unfolding and AUDUSD could be working on the recent downswing between 0.7660 and 0.6830. The Fibonacci 0.618 retracement of the above drop is seen towards 0.7350, which could provide enough resistance going forward. Either way, traders might be preparing for a rally towards 0.7350 at least.
Trading plan:
Potential rally through 0.7350 against 0.6800
Good luck!
