The AUD/USD pair  is developing the potential corrective wave B of the medium term uptrend (coral in the chart) from 1.0856 comprising three subwaves (magenta in the chart). The potential subwave A is developing against the downtrend from 1.0423.

Now the upside targets are Fibonacci retracements 1.0856-1.0423, 1.0669-1.0423 and expansions 1.0423-1.0554-1.0509.

Resistances:

- 1.0575 = .618 retracement
- 1.0588-90 = confluence area of .382 ret and contracted objective point (COP)
- 1.0640 = confluence area of objective point (OP) and .50 ret
- 1.0691 = .618 ret

If the downtrend resumes its movement, the immediate supports will be Fibonacci retracements 0.9861-1.0856, and expansions 1.0856-1.0509-1.0669, 1.0669-1.0423-1.0554.

Supports:

- 1.0402 = COP
- 1.0358 = .50 ret
- 1.0322 = OP
- 1.0303 = OP

Overbought/Oversold

The larger wave is now moving downwards, so it is better to open short positions when the Detrended Oscillator goes above the zero level (current prices) or into the overbought area (20-30 pips above the current prices). Consider the possibilities of short positions at or near the indicated resistances.

Read more on how to trade with Fibonacci levels.