AUD/USD Daily Outlook

Daily Pivots: (S1) 0.6740; (P) 0.6875; (R1) 0.6946; More

AUD/USD's rebound from 0.6008 was limited at 0.7014 and weakens today. Mild bearish divergence conditions in 4 hours MACD and RSI argues that such rebound has possibly completed. Break of 0.6549 support will confirm this case and bring retest of 0.6008 low. On the upside, though, above 0.7014 will indicate that rise from 0.6008 is still in progress for 38.2% retracement of 0.9849 to 0.6008 at 0.7475.

In the bigger picture, the strong rebound from 0.6008 indicates that whole fall from 0.9849 has likely completed the five wave sequence already, with the fifth wave ended at 0.6008, ahead of 76.4% retracement of 0.4773 to 0.9849 at 0.5971. Stronger rebound could be seen to 38.2% retracement of 0.9849 to 0.6008 at 0.7475 or above. Nevertheless, note that the impulsive nature of the fall from 0.9849 to 0.6008 indicate that price actions from 0.6008 is developing into correction/consolidation in a larger down trend only. The long term down trend is still expected to resume after completing the consolidation. On the downside, sustained break of 0.6008 will indicate that the down trend from 0.9849 has resumed for at least another five wave medium term decline.

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