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AUD/USD has ended its temporary rebound and now it seems determined to approach and reach new lows. A fresh new lower low validates a deeper corrective phase. The pair is located under a downtrend line, so the bias is bearish in the short term.
The greenback has taken the lead again as the USDX has managed to recover after yesterday's sell-off. A USDX's deeper drop should help the USD to appreciate further versus its rivals.
AUD/USD has retested the downtrend line and now is going down like a rock. Its failure to reach the median line of the ascending pitchfork signals strong sellers in the short term. The aggressive breakdown through the lower median line (lml) of the up pitchfork signals a quick drop to 0.7000 psychological level.
Technically, a bearish closure under the 0.7000 level could attract more sellers. AUD/USD failed to retest the Pivot Point, so the first downside target is represented by the S1 (0.7009) level.
The bearish bias remains intact as long AUD/USD stays under the black downtrend line. You should be careful around 0.7000 psychological level, a false breakdown with great separation or a major bullish engulfing could force the rate to increase again.
Buy AUD/USD if the price registers a valid breakout above the black downtrend line. A downside movement is favored as the quote is located far below the mentioned dynamic resistance.
Sell a valid breakdown below the 0.7000 psychological level. Pitchfork's first downside warning line could be used as a target. Also, the S3 (0.6831) could be reached if the currency pair extends its sell-off.
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