Australian Dollar Technical Outlook

The AUDUSD series of lower highs (and lower lows) since the June high of .8270 is no longer as price has exceeded .8162. Recent commentary has focused on the fact that “bigger picture, the AUDUSD is at risk of a significant decline as the structure of the rally from .6005 is corrective (3 waves)…” While this is true, the larger decline will probably not occur until price exceeds .8269 in wave v of C. .8385 (61.8% of the decline from .9856) is potential resistance. Like the EURUSD and GBPUSD, a short term corrective decline is expected. RSI divergence along with a short term trendline support break favors weakness near term.