Daily Pivots: (S1) 0.8785; (P) 0.8822; (R1) 0.8863; More
A short term bottom is in place in AUD/USD at 0.8734 with mild bullish convergence condition in 4 hour MACD. Recovery from there is still in progress and might extend further to neckline support turned resistance (now at 0.8977) but upside should be limited by 0.9013 resistance and bring fall resumption. On the downside, below 0.8808 minor support will suggest that such recovery is finished and flip intraday bias back to the downside. Break of 0.8734 will target 23.6% retracement of 0.6008 to 0.9404 at 0.8603 next.
In the bigger picture, the break of 0.8915/8945 support zone confirm the bearish case that AUD/USD has already topped out at 0.9404 in medium term, by completing a head and shoulder top (ls: 0.9326, h: 0.9404, rs: 0.9321). Deeper decline should now be seen to correct the whole rise from 0.6008 and should target 0.7702/0.8626 support zone. Nevertheless, strong support should be seen there, at lease initially, and bring rebound. On the upside, break of 0.9193 resistance is needed to invalidate this view. Otherwise, outlook will remain bearish.
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