FX.co ★ AUD/USD Elliott wave count and Fibonacci levels - February 23, 2011

The AUD/USD is developing corrective subwave B (colored red in the chart) within potential impulse wave C of the medium term downtrent (colored magenta in the chart). The targets of the upmove are Fibonacci retracements of 1.0098-0.9963, 1.0157-0.9963, and expansions off 0.9943-1.0157-0.9963.

Resistances:

- 1.0031-37 = confluence area of .50 and .382 retracements, already hit (!)
- 1.0046 = .618 ret
- 1.0060 = .50 ret
- 1.0083 = .618 ret
- 1.0095 = contracted objective point (COP)
- 1.0177 = objective point (OP)

If the price keeps declining the immediate supports will be Fibonacci expansions off 1.0199-0.9943-1.0157.

Supports:

- 0.9901 = OP

Overbought/Oversold

Assuming that the medium term trend is down, it's preferable to use overbought readings (25-30 pips away from the current price) of the Detrended Price Oscillator to consider short positions.

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