AUD/USD remains bounded in range of 0.6659/6765 last week. Initial bias stays neutral this week and further rise is in favor. On the upside, above 0.6765 will resume the whole rise from 0.5913 and target 61.8% projection of 0.5913 to 0.6706 from 0.6420 at 0.6910. However, considering bearish divergence condition in 4H MACD, firm break of 0.6659 will confirm short term topping, and bring deeper correction back to 55 D EMA (now at 0.6627) and below.
In the bigger picture, current development argues that rise from 0.5913 (2024 low) is reversing whole down trend from 0.8006 (2021 high). Further rally should be seen to 61.8% retracement of 0.8006 to 0.5913 at 0.7206. This will remain the favored case as long as 0.6420 support holds, even in case of deep pullback.
In the long term picture, rise from 0.5913 is tentatively seen as the third leg of the pattern from 0.5506 (2020 low). Sustained trading above 55 M EMA (now at 0.6711) will solidify this medium term bullish case. It’s still early to judge if this is an impulsive or corrective pattern. But in either case, firm break of 0.6941 will open up further rise back to 0.8006. However, rejection by the 55 M EMA will retain bearishness and bring another fall through 0.5913.
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