As of this writing, AUD/USD is trading near the 0.7115 mark, up from a 10-week low of 0.7030 reached at the end of last week. However, it is premature to talk about breaking the bearish trend of AUD/USD.
Last month, AUD/USD lost almost 6%, and two white candles on the daily price chart after a long series of black ones so far indicate the possible beginning of an upward correction. Trading below the key resistance levels of 0.7600 (200 EMA on the monthly chart), and 0.7310 (20 EMA on the weekly and daily charts), is in the bear market zone.
Meanwhile, AUD/USD is moving towards the important short-term resistance level of 0.7154 (200 EMA on the 1-hour chart). Its breakout may strengthen the AUD/USD position, sending it to the local resistance level of 0.7154. After its breakout, we can allow the development of an upward correction up to the resistance levels of 0.7300, 0.7310. Whether the price will go higher – here you will need to look at the situation again. Below the resistance level of 0.7310, as we have already noted, is a bear market zone.
In the main scenario, AUD/USD will resume its decline. The first signal to open new short positions will be a breakdown of support levels 0.7095 (200 EMA on the 15-minute chart), 0.7085 (local support level).
The downside targets, in this case, are the support levels of 0.7037 (38.2% Fibonacci retracement to the wave of the pair's decline from 0.9500 in July 2014 to the lows of 2020 near 0.5510), 0.7000, 0.6970 (an alternative scenario). Now, apparently, it is becoming the main scenario, and the alternative is the growth of AUD/USD.
Support levels: 0.7095, 0.7085, 0.7037, 0.7000, 0.6970
Resistance levels: 0.7154 0.7200 0.7300 0.7310 0.7400 0.7440 0.7510 0.7555 0.7615 0.7660 0.7730 0.7815 0.7835 0.7885 0.7800
Trading Tips
Sell Stop 0.7080. Stop-Loss 0.7160. Take-Profit 0.7037, 0.7000, 0.6970, 0.6900
Buy Stop 0.7160. Stop-Loss 0.7080. Take-Profit 0.7200, 0.7300, 0.7310, 0.7400, 0.7440, 0.7510, 0.7555, 0.7615, 0.7660, 0.7730, 0.7815, 0.7835, 0.7885, 0.7900, 0.8000
