AUD / USD remains in its high range above key supports at 0.7532 / 00 for now, but the risk of a corrective setback is increasing, according to the Credit Suisse analyst team.
“AUD / USD maintains its sharp rejection of key resistance and our first base target upward at the 38.2% retracement of the entire 2011/2020 decline to 0.7625 / 40. This rejection has strengthened the potential for a consolidation phase to help the market relax this was previously a condition of overbought and, more importantly, the risk of a deeper corrective pullback also increases.
“Support remains at the exponential 13-day average and the psychological barrier at 0.7532 / 00, which must hold close to avoid such a setback. Assuming this is the case the risk will still be seen higher after another lateral distance and with a large “ head and shoulders ” base still in place, a clean break of 0.7632 / 40 is sought after this phase, with the next initial resistance at 0.7673. / 77. ”
“A close below 0.7529 / 00 would rather confirm a deeper correction, with the next supports below here seen at the recent peak at 0.7462, then 0.7392 / 73.”