AUD/USD: Weekly close below 0.7106 to exacerbate the downfall – Credit Suisse

AUD/USD is so far holding major support at the 0.7106 low. Nevertheless, economists at Credit Suisse stay biased towards a closing breakdown to confirm a major long-term top. 

AUD/USD is very close to confirming a major top below 0.7106

“Weekly MACD has seen a confirmed negative cross, which further exacerbates the downside risks and we are now very confident that the market is in the process of forming a much larger long-term top, which would be confirmed by a weekly close below the 2021 low at 0.7106.” 

“A weekly close below 0.7106 would turn the long-term risks lower and suggest that aggressive further weakness is likely, with the next supports seen at 0.7053/48, which is the 38.2% retracement of the 2020/21 rise, then 0.6991.”

“The size of the top suggests a move to 0.6758 is easily achievable over the medium-term.” 

“Near-term resistance moves lower to 0.7145/50, then 0.7200/10, with more important resistance staying at 0.7268/74, which should hold into the close to maintain a high degree of confidence in the breakdown.”