AUD/USD's decline extended further last week as expected and reached as low as 0.9794 so far. Initial bias remains on the downside this week for 0.9663 support first, then 161.8% projection of 1.0852 to 1.0225 from 1.0473 at 0.9459. On the upside, above 0.9957 minor resistance will turn bias neutral and bring consolidations. But recovery should be limited below 1.0225 support turned resistance and bring fall resumption.
In the bigger picture, price actions from 1.1079 high are treated as a consolidation pattern in the larger up trend. Third leg has started at 1.0852 and deeper decline would now be seen to 0.9387/9663 support zone. Though, strong support is expected from there to contain downside and bring rebound. Above 1.0225 will indicate that fall from 1.0852 is finished and turn outlook bullish for a test on 1.0852/1079 resistance zone. However, note that sustained break of 0.9387 support will open up a few medium term bearish scenarios that could trigger selloff back to 0.8066 support.
In the longer term picture, whole up trend from 0.4773 (01 low) extended to a point where it just missed 100% projection of 0.4773 to 0.9849 from 0.6008 at 1.1084. At this point, there is pro spec t for a lengthier medium term consolidation. But there is no indication of long term reversal yet. We'll stay bullish as long as 0.8066 support holds and expect an eventual break of 1.1084 to 138.2% projection at 1.3023, which is close to 1.3 psychological level, in the long term.