AUD/USD: Recovery seen as corrective only, support awaits at 0.7284/83 – Credit Suisse

AUD/USD is still retesting its recent breakdown point at 0.7346. However, economists at Credit Suisse still view the recovery as corrective and alert to opportunities to fade the move.

See: AUD/USD to gain upside momentum on a sustained move above 0.7340 – TDS

Be alert for signs of failure at 0.7346

“With a large top in place and trend following indicators still bearish though, our base case is still that the recent recovery is a corrective move higher and we are alert for signs of rejection from the important resistance zone at 0.7346.” 

“First signs of a turn back lower would be given below 0.7284/83, with the next support then seen at the recent ‘outside day’ low at 0.7221/20. 

“A break above 0.7346 would instead suggest the correction can extend further, with more important medium-term resistance between 0.7383/90 and 0.7428, which needs to hold to avoid a large base and to maintain our view that this is a corrective recovery.”