AUD/USD – 0.7723
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
Original strategy :
Buy at 0.7635, Target: 0.7775, Stop: 0.7575
New strategy :
Buy at 0.7645, Target: 0.7800, Stop: 0.7585
As aussie has risen again after brief pullback and broke above indicated previous resistance at 0.7741, suggesting recent upmove has resumed and bullishness remains for further gain to 0.7778 (last year’s high), however, break there is needed to retain upside bias and extend headway to 0.7840-50 but price should falter below 0.7900, risk from there has increased for a retreat to take place later.
In view of this, we are looking to buy aussie on subsequent pullback as 0.7633-36 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.