AUD/USD’s break of 0.7413 high last week suggests resumption of whole rise form 0.5506. Further rise is expected this week as long as 0.7351 support holds. Next target is 0.7635 key long term fibonacci level. On the downside, however, break of 0.7351 will indicate short term topping and turn bias back to the downside for pull back.
In the bigger picture, the sustained trading above 55 week EMA (now at 0.6978) is a sign of medium term bullishness. Nevertheless, AUD/USD will still need to overcome 38.2% retracement of 1.1079 (2011 high) to 0.5506 (2020 low) at 0.7635 decisively to indicate completion of long term down trend from 1.1079. Otherwise, current rebound from 0.5506 could still turn out to be a correction in the long term down trend.
In the longer term picture, bullish convergence condition in monthly MACD is a condition for long term bullish reversal. Focus will be on 38.2% retracement of 1.1079 (2011 high) to 0.5506 (2020 low) at 0.7635. Decisive break there should confirm reversal and target 61.8% retracement at 0.8950. Though, rejection by 0.7635 will retain long term bearishness for another low through 0.5506 at a later stage.
