FX.co ★ AUD/USD Elliott wave count and Fibonacci levels - May 9, 2011

AUD/USD has finished wave 0.9709-1.1011 (wave A of long term uptrend) and now is developing correction against it. Within the corrective wave there are A and B subwaves, with subwave B still developing - colored magenta in the chart. The targets of the upmove are Fibonacci retracements of 1.1011-1.0536, and expansions off 1.0536-1.0802-1.0661.

Resistances:

- 1.0825-30 = confluence area of contracted objective point (COP) and .618 retracement
- 1.0927 = objective point (OP)

If the downtrend resumes the immediate supports will be Fibonacci retracements of 0.9709-1.1011, 1.0536-1.0802, and expansions off 1.1011-1.0536-1.0802.

Supports:

- 1.0669 = .50 ret
- 1.0638 = .618 ret
- 1.0514-08 = confluence area of .382 retracement and COP
- 1.0360 = .50 retracement
- 1.0327 = OP

Overbought/Oversold

Assuming that the medium term trend is down but a corrective wave is developing it's preferable to stand aside or try long positions when the Detrended Oscillator goes below the zero level (30-35 pips below current prices) or gets into the oversold area (75-95 pips below the current prices).

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