Weekly
• Last Candlesticks pattern: Long white candlestick
• Time of formation: 10 Jul 2017
• Trend bias: Up
Daily
• Last Candlesticks pattern: Long white candlestick
• Time of formation: 18 Jul 2017
• Trend bias: Up
Aussie met renewed selling interest at 0.7884 late last week and has dropped again since, retaining our bearish view that the rebound from 0.7733 has possibly ended at 0.7897 earlier this month and downside bias remains for a retest of this support, however, break there is needed to confirm the fall from 0.8125 top has resumed for retracement of early upmove to previous resistance at 0.7712, break there would extend weakness to 0.7660-70 and then 0.7620-30 but support at 0.7535-40 should remain intact due to oversold condition.
On the upside, expect recovery to be limited to 0.7810-15 and price should falter below the Tenkan-Sen (now at 0.7834), bring another decline later. Above said resistance at 0.7884 would risk another test of 0.7897 but only break there would signal a temporary low has been formed at 0.7733, bring retracement of the fall from 0.8125 to 0.7970-75, however, still reckon upside would be limited to 0.8000 and price should falter below resistance at 0.8103, bring another decline later.
Recommendation: Hold short entered at 0.7880 for 0.7680 with stop above 0.7850
On the weekly chart, last week’s retreat after meeting resistance at 0.7884 formed a black candlestick, retaining our bearish view that the rebound from 0.7733 has possibly ended at 0.7897, hence consolidation with downside bias remains for weakness to this support, break there would add credence to our view that top has been formed at 0.8125 and extend weakness to 0.7675-80, then possibly to 0.7630-35 (61.8% Fibonacci retracement of 0.7329-0.8125) but reckon support at 0.7535 would hold from here.
On the upside, although recovery to 0.7810-15 cannot be ruled out, reckon 0.7835 (this week’s high) would cap upside and bring another decline to aforesaid downside targets. Only break of said resistance at 0.7897 would risk a stronger rebound to the Tenkan-Sen (now at 0.7929), a weekly close above there would defer and bring further gain to 0.8020-30, however, price should falter below resistance at 0.8103 and bring another decline later. A break of 0.8103 resistance would signal the retreat from 0.8125 top has ended instead, bring retest of this level. Looking ahead, only above there would extend the erratic rise from 0.6827 low to previous resistance at 0.8163, then 0.8200 but loss of upward momentum should limit upside to previous resistance at 0.8295.
