Trade Idea: AUD/USD – Hold long entered at 0.7895

AUD/USD – 0.7954

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 :

Bought at 0.7895, Target: 0.8050, Stop: 0.7900

Position: – Long at 0.7895
Target:  – 0.8050
Stop: – 0.7900

New strategy :

Hold long entered at 0.7895, Target: 0.8050, Stop: 0.7900

Position: – Long at 0.7895
Target:  – 0.8050
Stop:- 0.7900

As aussie has retreated after brief rise to 0.7996, suggesting consolidation below this level would be seen, however, as long as support at 0.7905 holds, bullishness remains for another rebound, above 0.7996-00 would add credence to our view that low has possibly been formed at 0.7808 earlier this month, bring a stronger rebound to 0.8030, however, break of recent high at 0.8066 (wave iii peak) is needed to confirm upmove has resumed in wave v to 0.8100-10 first. 

In view of this, we are holding on to our long position entered at 0.7895. Below said support at 0.7905 would risk test of indicated previous support at 0.7865-67, break there would dampen this bullish scenario and suggest the rebound from 0.9808 has ended, bring another test of this level, below there would signal the wave iv correction from 0.8066 is still in progress for weakness to 0.7786 support, however, oversold condition should prevent sharp fall below 0.7750 and price should stay above i top at 0.7712, bring rebound later. We are keeping our latest bullish count that recent impulsive waves is unfolding as (1 2, (i)(ii), i ii) and may extend headway towards 0.8150. 

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.