Aussie is seeing a pretty strong selloff here, so it’s possible that we already saw the top of wave five. Notice that price broke below the trend line support of that bullish channel, which makes us think that wave five may already be completed and that we could see much deeper weakness later on. In fact, we see an impulsive drop from the highs, so we may now be stepping into a higher degree A B C decline, meaning that after B wave rise, pair could see much more weakness. Plus, we have seen a weekly close around 0.7136 level, which seems like important confirmation that the trend is reversing, which after all has been expected because of the higher degree completed 5-wave structure visible on the daily chart.
Resistance on rallies is at 0.7180-0.7200.
One of the reasons for a potential deeper pullback on Aussie is also the unexpected rise in unemployment, which means RBA can stay on hold for now, especially since they have already hiked three times this year.
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