AUD/USD – 0.7687
Recent wave: Wave 5 ended at 1.1081 and major correction has commenced for fall to 0.7000 and then towards 0.6500-10
Trend: Near term up
New strategy :
Buy at 0.7640, Target: 0.7775, Stop: 0.7580
As aussie has surged after brief pullback, adding credence to our view that low has been formed at 0.7491 and mild upside bias remains for the rise from 0.7491 low to extend further gain to 0.7741 resistance, break there would signal early upmove has resumed for headway towards last year’s high at 0.7778 which is likely to hold on first testing. Looking ahead, a break of this level would retain bullishness and extend medium term upmove to 0.7840-50 but price should falter below 0.7900.
In view of this, we are looking to buy aussie on dips as 0.7640-50 should limit downside and bring another rise later. Only below previous resistance at 0.7592 would abort and signal top is formed instead, then further choppy trading would take place and risk is seen for pullback to 0.7530-40 but said support at 0.7491 should remain intact.
On the 4-hour chart, the move from 0.8066 is the wave 5 with i: 0.8860, ii: 0.8315, wave iii is an extended move ended at 1.0183, iv: 0.9706 and wave v has ended at 1.1081 (also the top of entire wave 5). The subsequent selloff is the major correction which is unfolding as ABC-X-ABC and 2nd A leg has ended at 0.8848, followed by a-b-c wave B which ended at 0.9758, hence, 2nd C wave is now in progress and indicated downside target at 0.7000 and 0.6950 had been met, so further fall to 0.6710-20 cannot be ruled out.