The AUD/USD pair plunges as the Dollar Index reached fresh new highs after erasing its minor losses. As you already know, the pair rebounded in the short term but it was only a temporary one. Now, it's traded at 0.7251 level at the time of writing far below 0.7458 yesterday's high.

AUD/USD dropped by 2.81% from yesterday's high to 0.7248 today's low. The USD is strongly bullish as the FED is expected to continue hiking rates as the inflationary pressure continues to grow. Fundamentally, the Aussie drops even if the Australian Flash Manufacturing PMI came in at 57.9 points above 57.7 in the previous reporting period, while the Flash Services PMI was reported higher at 56.6 points in April versus 55.6 in March.

AUD/USD Strongly Bearish!

As you can see on the H4 chart, the price is extremely bearish. It has ignored the near-term downside obstacles and now it challenges the descending pitchfork's lower median line (lml) and the weekly S3 (0.7250).

A valid breakdown may signal more declines towards 88.6% (0.7221) or down to 100% (0.7165). Staying above the lower median line (lml) may signal that the sellers could be exhausted.

AUD/USD Prediction!

After its massive drop, a temporary rebound is somehow expected. False breakdowns below the lower median line (lml) could signal a potential rebound. Still, the pressure is high, AUD/USD could drop deeper anytime.

Personally, I would like the price to rebound, to increase towards the 0.73 psychological level before selling the pair again. A valid breakdown below the S3 (0.7250) could confirm more declines and could bring short opportunities on lower timeframes.