AUD/USD: Recovery seen as corrective while below 0.7292/7309 – Credit Suisse

AUD/USD surged back higher on Wednesday. However, whilst below 0.7292/7309, analysts at Credit Suisse view any strength as corrective.

Break below 0.7089/82 to confirm a resumption of the downtrend

“AUD/USD is now breaking above its recent corrective price high at 0.7225. This sharply increases the risk of a correction up to 0.7292/7309, with only a closing break above here negating the major recently highlighted top. However, our base case is that the market will find a cap below here and turn back lower.”

“With the broader downside risks in mind, an eventual break below the recent corrective price low at 0.7089/82 would confirm a resumption of the downtrend and a retest of next support at 0.6992/91.” 

“Below 0.6992/91 would then open up 0.6806/02, with the size of the top suggesting a move to 0.6758 is easily achievable over the medium-term.”