The AUD/USD is developing the potential corrective wave B of the medium term uptrend (coral in the chart) from 1.0856. Within this wave there are subwaves A, B and C (royal blue in the chart). An impulse subwave C is developing from 1.0636. The latter comprses subwaves A and B (red in the chart), subwave B is developing from 1.0336. Within B there are three waves (orange red in the chart), with subwave C still developing from 1.0371.
The upside targets are Fibonacci retracements 1.0636-1.0336 and expansions 1.0336-1.0449-1.0371.
Resistances:
- 1.0484-86 = confluence area of objective point (OP) and .50 retracement
- 1.0521 = .618 ret
- 1.0554 = expanded objective point (XOP)
If the price reverses to the downside, the immediate supports will be Fibonacci retracements 0.9861-1.0856 expansions 1.0856-1.0423-1.0636, 1.0636-1.0336-1.0491.
Supports:
- 1.0306 = contracted objective point (COP)
- 1.0241 = .618 retracement
- 1.0203 = OP
- 1.0191 = OP
Overbought/Oversold
The larger wave is now moving downside, so it is better to go short when the Detrended Oscillator goes above the zero level (5-10 pips above the current prices) or into the overbought area (25-35 pips above the current prices). Consider the possibilities to go short at or near the indicated resistances.
