Price has formed a really nice 5-wave movement going down. This is the first sign of a good bullish bounce. We look to buy above 0.7383 support (Fibonacci retracement, horizontal overlap support, bullish divergence) for a bounce up towards 0.7461 resistance (Fibonacci retracement, Elliott wave theory, horizontal pullback resistance).Stochastic (55,5,3) is seeing major support above the 4% level where we expect a bounce from. We can also see bullish divergence vs price signalling that a bounce is impending.Correlation analysis: AUD/USD has a strong positive correlation with NZD/USD which means they usually move together. We are expecting a rise on AUD/USD and a drop on NZD/USD, hence it is best to exercise caution on this trade.
Buy above 0.7383. Stop loss at 0.7359. Take profit at 0.7461.
