AUD/USD Daily Outlook

Daily Pivots: (S1) 0.8789; (P) 0.8852; (R1) 0.8892; More

AUD/USD's break of 0.8779 indicates that recent fall from 0.9327 has resumed and should be targeting 0.8734 support next. As noted before, break there will confirm that whole decline from 0.9404 high has resumed and should target medium term fibonacci level at 23.6% retracement of 0.6008 to 0.9404 at 0.8603. On the upside, though, above 0.8915 will argue that a short term bottom is formed and will flip intraday bias back to the upside for stronger rebound.

In the bigger picture, the failure below 0.9404 high and deep pull back from 0.9327 mixes up the outlook of AUD/USD and we'll stay neutral for the moment. Nevertheless, one thing to note is that AUD/USD is losing upside momentum as seen with bearish divergence in daily MACD. Hence, even in case of another rise, we'd expect strong resistance as AUD/USD approaches 2008 high of 0.9849 and bring reversal. On the downside, break of 0.8734 support will in turn revive the case that whole medium term rise from 0.6008 has completed and will turn outlook bearish for deeper correction towards 0.7702/0.8626 support zone.

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