In our previous post on AUDUSD we mentioned the upside potential for AUDUSD. What is critical to that bullish scenario is for price to hold above recent lows at 0.7220. The delay to push price higher and break above resistance levels, increases the chances of price breaking below 0.7220 and falling lower towards 0.71.

Price is trading around 0.7230 just above the major support area. Inability to push above 0.7320 is a sign of weakness. Price has retraced 61.8% of the entire upward move from 0.7110 to 0.7480. This a major support area. Breaking below this level will open the way for a move lower towards 0.71. As long as price is below 0.7270 price will remain vulnerable to a move lower and a break of support at 0.7220.