FX.co ★ AUD/USD Elliott wave count and Fibonacci levels for May 25, 2011

AUD/USD is developing subwave C (colored royal blue in the chart) within wave C of long term downtrend - colored light green in the chart. Now we have a potential impulse subwave C within the former subwave - colored red in the chart.

The targets of the downmove are Fibonacci retracements of 1.0504-1.0710, and expansions off 1.1011-1.0536-1.0888, 1.0888-1.0504-1.0710, 1.0710-1.0478-1.0582.

Supports:

- 1.0473 = contracted objective point (COP)
- 1.0439 = COP
- 1.0413 = objective point (OP)
- 1.0360 = .50 ret
- 1.0350 = OP
- 1.0326 = OP

If the price stays above 1.0478 and keeps moving up the immediate resistances will be Fibonacci retracements of 1.0710-1.0478.

Ressitances:

- 1.0594 = .50 retracement
- 1.0621 = .618 ret

Overbought/Oversold

Assuming that the medium term trend is down it's preferable to try short positions when the Detrended Oscillator goes above the zero level (35-40 pips above the current prices) or gets into the overbought area (60-70 pips above the current prices).

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