AUD/USD drops like a rock in the short term after ending its temporary rebound. USDX’s further growth may force the pair to drop deeper.
The USD has taken the lead again after the US CB Consumer Confidence jumped from 90.4 to 109.7 points beating the 96.9 expectations. The greenback needed a bullish spark from the US economy to be able to resume its appreciation.
AUD/USD Head & Shoulders!
AUD/USD rebounded in the short term but its failure to stabilize above the 38.2% retracement level and beyond the pivot point (0.7653) signals that the price could extend its sell-off.
The major Head & Shoulders pattern announced a bearish reversal, so AUD/USD may approach and reach fresh new lows.
The first downside target is seen at 0.7563 former low. Dropping and stabilizing below this low validates more declines.
Trading Conclusion!
AUD/USD increased to retest the immediate resistance levels before dropping deeper. The current sell-off below 38.2% indicates strong bearish pressure.
Dropping and closing below 0.7563 could activate a sharp sell-off towards the 50% retracement level or lower.
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