AUD/USD's rally from 0.9588 extended last week and reached as high as 1.0486. Initial bias remains on the upside this week and further rise should be seen towards upper trend line resistance (now at 1.0695). We'll be cautious on reversal signal there. On the downside, below 1.0176 is needed to signal near term reversal, though. Otherwise, further rally will remain in favor even in case of retreat.

In the bigger picture, price actions from 1.1079 high are treated as a consolidation pattern in the larger up trend. Current development suggests that rebound from 0.9588 is the fourth leg inside the consolidation pattern, which could be a triangle. Sustained break of 1.0225 will target upper trend line (now at 1.0695) but strong resistance should be seen there to bring at least one more fall. After all, firstly, break of 1.0852 is needed to signal larger up trend resumption or more consolidative trading could be seen. Secondly, any downside attempt would likely be contained by 0.9387/9663 support zone.

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 prospect 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.

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