I see that the current trading week is heavily influenced by powerful fundamental reports at the start of the month, particularly those that reflect the state and health of the American economy, and I understand that such fundamentals can often override technical analysis signals, creating movements that may go against purely chart-based expectations. I am aware that more stable and calmer trading conditions are likely to appear only from the next working week, once the intense news background passes, and I anticipate that traders, including myself, will then return to focusing more on pure technical setups to push the price direction of the AUD/USD pair. I recognize that after today’s sharp and powerful decline, I am now observing a natural corrective move, and I apply the Fibonacci grid to measure that the correction has already reached at least the 50% level, bringing the price quote near 0.6520 on the four-hour timeframe. I consider that level significant because it may serve as a pivot point that could either support a continuation of the developing northern, upward trend or create the basis for testing the stronger resistance zone at 0.6555. I note that if the price successfully breaks through this resistance and consolidates above it, I will then see an open path for further bullish continuation and the potential completion of the current corrective zigzag pattern, which to me signals that the pair might shift momentum in favor of buyers. I remain cautious but prepared, as I acknowledge that fundamental shocks can still intervene, yet I keep my focus on these technical levels to guide my trading decisions.
I noticed that after the Australian Dollar to the US Dollar (AUD/USD) managed to break above the 100-period moving average on the 15-minute timeframe, the bullish momentum quickly dried up, and I saw the bears step in with strong control over the market. I observed how the sellers pushed the price downward aggressively, and I measured that the decline reached about 63 pips in just a few hours until the price bottomed near the 0.6487 level. I then identified the first corrective wave, and I calculated that this correction managed to retrace nearly 50% of the initial fall, which I consider quite a deep pullback in such a short-term move. I understand that a 50% correction often signals that the market might not be ready for an immediate continuation and instead could enter a phase of sideways consolidation before deciding the next big move. I now believe that the sideways movement will likely unfold between the newly formed support at 0.6514 and the nearby resistance level at 0.6527, and I have already seen the price oscillate several times within this narrow corridor. I expect that such behavior can persist for the next 24 hours as market participants digest the recent volatility and prepare for the next wave of direction. I personally plan to closely monitor this range, and I am already considering how the eventual breakout could give me a new entry point, especially since I still lean toward selling this pair after the recent bearish impulse. I want to see confirmation that the price fails to break higher before I commit, and I prefer waiting patiently for the best setup, as I know that entering too early in a sideways phase often results in unnecessary drawdowns. I therefore remain cautious but focused, and I am confident that if the price resumes its southern course, I will have a strong opportunity to rejoin the bearish move with clear targets and disciplined risk management.
