Daily Pivots: (S1) 0.7064; (P) 0.7137; (R1) 0.7173; More…
AUD/USD drops notably today but recovers after breaching 0.7100 minor support. Intraday bias remains neutral first. On the upside, break of 0.7209 resistance will resume the rebound from 0.7005. That will also indication of completion of correction from 0.7413. In this case, further rally would be seen to retest 0.7413 high. On the downside, however, break of firm break of 0.7100 will suggest that correction from 0.7413 is resuming. Intraday bias will be turned back to the downside for 0.7005, and then 38.2% retracement of 0.5506 to 0.7413 at 0.6685.
In the bigger picture, while rebound from 0.5506 was strong, there is not enough evidence to confirm bullish trend reversal yet. That is, it could be just a corrective inside the long term up trend. Sustained trading back below 55 week EMA (now at 0.6908) will favor the bearish case and argue that the rebound has completed. Focus will be turned back to 0.5506 low. On the upside, break of 0.7413 will extend the rise from 0.5506 to 38.2% retracement of 1.1079 (2011 high) to 0.5506 (2020 low) at 0.7635.
