AUD/USD is developing potential impulse wave C of medium term downtrend (colored light green in the chart) from 1.0379. Within this wave there are two subwaves (colored red in the chart) with subwave B still developing from 1.0048. The targets of the upmove are Fibonacci retracements of 1.0379-1.0048, and expansions off 0.9663-1.0379-1.0048.
Resistances:
- 1.0253 = .618 retracement
- 1.0308 = .786 ret
- 1.0490 = contracted objective point (COP)
If the downtrend continues the immediate supports will be Fibonacci retracements of 0.9663-1.0379, and expansions off 1.0379-1.0048-1.0224.
Supports:
- 1.0019-21 = confluence area of .50 ret and COP
- 0.9937 = .618 ret
- 0.9893 = objective point (OP)
Overbought/Oversold
Assuming that the larger wave is now moving down it's preferable to try short positions when the Detrended Oscillator goes above the zero level (25-30 pips above the current prices) or gets into the overbought area (60-75 pips above the current prices), watch for short entries at the specified resistances.
Read more on how to apply Fibonacci studies to calculate price targets.
