Daily Pivots: (S1) 0.7081; (P) 0.7101; (R1) 0.7123; More…
AUD/USD stays below 0.7121 minor resistance despite recovery. Intraday bias remains neutral first. Further fall remains in favor with 0.7121 intact. On the downside, break of 0.7003 will extend the fall from 0.7295 to 61.8% retracement of 0.6722 to 0.7295 at 0.6941 and below. However, firm break of 0.7121 will argue that decline from 0.7295 has completed at 0.7003. In that case, further rise should be seen to 0.7206 resistance to confirm. More importantly, in that case, corrective three wave structure of the fall from 0.7296 to 0.7003 would suggest that rise from 0.6722 low is extending through 0.7295.
In the bigger picture, as long as 0.7393 resistance holds, we’d treat fall from 0.8135 as resuming long term down trend from 1.1079 (2011 high). Decisive break of 0.6826 (2016 low) will confirm this bearish view and resume the down trend to 0.6008 (2008 low). However, firm break of 0.7393 will argue that fall from 0.8135 has completed. And corrective pattern from 0.6826 has started the third leg, targeting 0.8135 again.
