AUD/USD’s decline from 0.7031 extended to as low as 0.6682 last week. The development affirmed our view that corrective rise from 0.6670 has completed and larger down trend is ready to resume. Initial bias remains on the downside this week. Decisive break of 0.6670 will target next key support at 0.6008.
In the bigger picture, AUD/USD’s decline from 0.8135 (2018 high) is still in progress. It’s part of the larger down trend from 1.1079 (2011 high). Next target is 0.6008 (2008 low). This will remain the favor case as long as 0.7031 resistance holds.
In the longer term picture, prior rejection by 55 month EMA maintained long term bearishness in AUD/USD. That is, down trend from 1.1079 (2011 high) is still in progress. Next downside target is 61.8% projection of 1.1079 to 0.6826 from 0.8135 at 0.5507.