A sharp impulsive reversal higher in this week suggests that AUD/USD found a temporary low and completed an ending diagonal in wave 5 with a throw-over formation.
A throw-over occurs when volume is high in the fifth wave that approaches the lower trendline of the pattern, and extends slightly beneath it before a reversal occurs.
As such, the wave count is now pointing higher for a minimum three waves retracement back to former black wave four levels; 1.0375.
The pair also tested and reversed lower from blue wave (iv) resistance yesterday and that caused a current a pull-back in wave B that will ideally look for a support around 1.0200 area.
Expect a wave C rise from those levels, while pair trades above 1.0115 invalidation level.
Sentiment table
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Current Trend/Sentiment |
Directional Bias |
Strategy |
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Up |
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03/06 We favour longs as long as pair trades above 1.0115 low. |
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