AUD/USD: Downward bubble has started to develop - Natixis

Analysts at Natixis explain that the AUD/USD pair faltering on the resistance around 0.7740-0.7748 triggered a sharp downward correction as it broke below several major supports at 0.7660 and then 0.7587-0.76, while a downward bubble has started to develop in the daily chart.

Key Quotes

“In addition, the weekly stochastic turned bearish once again.”

“Under these conditions, caution will be in order, with an eye on the support at 0.75 (weekly Bollinger moving average). If it gives, this would open the way for a more pronounced decline towards 0.7389 (monthly Bollinger moving average), possibly the supports around 0.73-0.7317 (weekly parabolic).”

“Take advantage of rebounds towards 0.7587-0.76 to sell the pair, with 0.75 as the first target (setting the stop loss above 0.7660).”