AUD/USD dropped further to 0.7345 last week but formed a temporary low ahead of 0.7328 cluster support (61.8% retracement of 0.6826 to 0.8135 at 0.7326). Intraday bias is mildly on the upside this week for rebound. But upside should be limited below 0.7676 resistance to bring fall resumption. ON the downside break of 0.7328 cluster support will target 61.8% projection of 0.8135 to 0.7411 from 0.7676 at 0.7229 next.
In the bigger picture, medium term rebound from 0.6826 is seen as a corrective move that should be completed at 0.8135. Deeper decline would be seen back to retest 0.6826 low. This will now remain the favored case as long as 0.7676 resistance holds.
In the longer term picture, 0.6826 is seen as a long term bottom. Rise from there could either reverse the down trend from 1.1079, or just develop into a corrective pattern. At this point, we’re favoring the latter. And, as long as 38.2% retracement of 1.1079 to 0.6826 at 0.8451 holds, we’d anticipate another decline through 0.6826 at a later stage. But strong support should be seen between 0.4773 (2001 low) and 0.6008 (2008 low).
