FX.co ★ AUD/USD Elliott wave count and Fibonacci levels, October 7, 2010

Australlian dollar is still developing medium and long term uptrend. Wave count shows that this pair is moving within daily wave C - colored light green in the chart. Within the latter there's a set of A-B-C waves of smaller degree, with subwave C developing - colored royal blue in the chart.

The targets of the upmove are Fibonacci expansions of the daily waves and subwaves 0.8772-0.9599-0.9462, 0.9462-0.9749-0.9541, and expansions off still smaller waves 0.9541-0.9780-0.9727, 0.9727-0.9790-0.9756.

Resistances:

- 0.9875 = contracted objective point (COP)
- 0.9921 = super expanded objective point (SXOP)
- 0.9966-73 = confluence area of objective point (OP) and COP
- 1.0005 = expanded objective point (XOP)

In case the price reverses for a correction the supports will be Fibonacci retracements of the wave up from 0.9727 (wave not developed yet).

Overbought/Oversold

The Detrended Oscillator is making a second attempt to get into the oversold. Assuming that the prevailing trend is up the current contitions are not yet ripe for a new long position. It's preferable to wait for a weakness - oversold condition or a Fibonacci support - to enter a new long.

Read more on how to apply Fibonacci studies to calculate price targets.