AUD/USD plunged after ending its temporary rebound. The bias is bearish and the pair may approach and reach fresh new lows. The price has registered a new lower low signaling more declines.
The USD was still expected to increase and resume its appreciation after the US CB Consumer Confidence increased from 90.4 to 109.7 beating 96.9 expectations on Tuesday. Also, the ADP Non-Farm Employment Change jumped from 176K to 517K. It was almost to reach 552K estimate which is good for the greenback.
The US will continue to release significant data till the end of the week. Positive figures should support USD's appreciation. The Unemployment Claims may drop to 678K from 684K in the last week, the ISM Manufacturing PMI may increase from 60.8 to 61.5, while the Final Manufacturing PMI is expected to increase to 59.2 points signal expansion.
AUD/USD has increased a little in the short term to retest the pivot point (0.7653) and the neckline before resuming its decline.
As you already know from my previous analyses, AUD/USD could develop an important corrective phase after validating the major Head & Shoulders reversal pattern.
The current drop below 0.7563 lower low and under the S1 (0.7550) indicates selling pressure and confirms a further decline towards the lower median line (LML) and down to the 50% retracement level.
A valid breakdown through these immediate downside obstacles could really validate a larger drop.
Forecast & Tips!
The pivot point and the neckline retest validates the major Head & Shoulder pattern. The current aggressive breakdown below the S1 (0.7550) is seen as a selling signal with an immediate target at 0.75 psychological level.
0.7460 could be used as a downside target as well if AUD/USD continues to drop in the coming days.
The material has been provided by InstaForex Company - www.instaforex.com