AUD/USD surged to as high as 0.7965 last week and maintained near term bullishness. Initial bias stays on the upside this week for 0.7777/7833 resistance zone. A this point, we’d still expect strong resistance from there to limit upside and bring near term reversal. Break of 0.7510 minor support will indicate that rise from 0.7158 has completed already and turn bias back to the downside for this key near term support level.
In the bigger picture, we’re still treading price actions from 0.6826 low as a correction. And, as long as 38.2% retracement of 0.9504 to 0.6826 at 0.7849 holds, long term down trend from 1.1079 is expected to resume sooner or later. Break of 0.6826 low will target 0.6008 key support level. However, firm break of 0.7849 will indicate that rise from 0.6826 is developing into a medium term rebound, rather than a sideway pattern. In such case, stronger rise should be seek to 55 month EMA (now at 0.8205) and above.
In the longer term picture, while the down trend from 1.1079 might extend lower, we’re not anticipating a break of 0.6008 (2008 low) yet. We’ll look for bottoming above there to reverse the medium term trend.