AUD/USD dropped sharply to as low as 0.8315 last week. The break of 0.8549 support suggests that corrective rise from 0.8066 is finished with three waves up to 0.8858, just ahead of 61.8% retracement of 0.9380 to 0.8066 at 0.8878. While some recovery might be seen initially this week, we'd expect upside to be limited well below 0.8858 resistance and bring fall resumption. Below 0.8315 will target a test on 0.8066 support next.
In the bigger picture, the failure to sustain above 55 days EMA argues that rebound from 0.8066 was merely a correction in the larger decline and has finished. Break of 0.8066 will target next key support level at 0.7702 as medium term correction from 0.9404 extends. On the upside, break of 0.8858 is needed to confirm rebound resumption. Otherwise, we'll favor more downside.
In the longer term picture, 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.