FX.co ★ AUD/USD Elliott wave count and Fibonacci levels - March 31, 2011

The AUD/USD is developing corrective subwave B (colored red in the chart) within wave 5 of medium term uptrend - colored magenta in the chart. The targets of the downmove are Fibonacci retracements of 0.9709-1.0343, 1.0064-1.0343, 1.0204-1.0343.

Supports:

- 1.0290 = .382 retracement
- 1.0274 = .50 ret
- 1.0257 = .618 ret
- 1.0236 = .382 ret
- 1.0204 = .50 ret
- etc.

If the uptrend resumes and the price breaks above 1.0343 the immediate resistances will be Fibonacci expansions off 0.9709-1.0127-1.0064, 1.0064-1.0313-1.0204.

Resistances:

- 1.0358 = contracted objective point (COP)
- 1.0453 = objective point (OP)

Overbought/Oversold

Assuming that the medium term trend is up, it's preferable to look for longs when the Detrended Oscillator goes below the zero level (current prices) or gets into the oversold area (15-20 pips to go), or still bettern when the price hits 1.0290 Fib support.

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