AUD/USD dived to as low as 0.8809 last week before recovery mildly. The strong break of 0.8915/45 support zone confirms that a medium term top is already in place at 0.9404. With 4 hours MACD crossed above signal line, some consolidations could be seen initially this week. Nevertheless, upside should be limited below 0.9013 support turned resistance and bring fall resumption. Below 0.8809 will target 23.6% retracement of 0.6008 to 0.9404 at 0.8603 next, which is close to 161.8% projection of 0.9404 to 0.8945 from 0.9321 at 0.8593.
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.
In the longer term picture, as noted before, long term correction from 0.9849 has likely completed at 0.6008 already, after being supported slightly above 76.4% retracement of 0.4773 (01 low) to 0.9849 (08 high). Rise from 0.6008 is possibly developing into a new up trend which extend the long term rise from 0.4773. We'll continue to favor the long term bullish case as long as 0.7702 support holds and expect an eventual break of 0.9849 high. However, a break of 0.7702 support will firstly argue that whole rise from 0.6008 has completed. Secondly this will open up the case that AUD/USD is in phase of a long term consolidation and will gyrate in the large range of 0.6008/0.9849 for some time.