Daily Forex Update: AUD/USD
By: Dima Chernovolov
AUD/USD continues to fall inside the well-formed Falling Wedge chart pattern which was recently identified by Autochartist on the daily charts. Autochartist rates the quality of this Falling Wedge at the 5-bar level – which is the result of the slow Initial Trend (2 bars) and significant Uniformity and Clarity (both rated at the 7 bar level). AUD/USD is expected to fall further inside this Falling Wedge – in line with the previous breakout of the support area shown below.
As can be seen from the daily AUD/USD chart below, the pair recently broke the support area lying between the key support level 0.7730 (which stopped the previous sharp downward impulse wave at the start of October) and the 50% Fibonacci correction of the extended upward price impulse from May. This price area is acting as resistance zone after it was broken. The proximity of resistance zone increases the probability AUD/USD will continue to fall inside this Falling Wedge.
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