After hitting the low of 0.7531 on the 02.04, AUD/USD formed a double bottom that could be a reversal signal pushing the rate higher in the long term. Although in a small time frame, after breaking below the uptrend, it appears that the pair could make a correction lower.
The Fibonacci applied to the trend-line breakout point shows the current support and resistance levels as well as potential downside target. Currently, AUD/USD is rejecting the S1 support and there is a possibility that the pair will return back to one of the resistance levels, either R1 or R2 before/if moving lower.
Consider selling AUD/USD either on a pullback around R1 (0.7953) resistance or on the breakout of the current low at the S1 (0.7903) support targeting 0% Fibonacci – S3 (0.7745) support area. A breakout above R2 (0.8002) should bring the pair back to the most recent high, which seems to have low probability at this point.
Support: 0.7903, 0.7843, 0.7745
Resistance: 0.7953, 0.8002, 0.8161
The material has been provided by InstaForex Company – www.instaforex.com