AUD/USD Price Analysis: Prospects of a test of 0.7700 towards 0.7650s

• AUD/USD bears threatening a deeper correction of the weekly impulse towards 0.7700.
• The bullish trend, however, is intact while above 0.7658 with weekly reverse H&S in the making.

Further to the prior analysis, AUD/USD Price Analysis: Bears monitoring for failures at resistance, the price has continued to deteriorate from the tops in 4-hour technically bearish conditions and has eyes on the 0.77 figure:

Prior analysis 

On USD strength and in a late response to the Reserve Bank of Australia's jawboning in the Asian session, and following an upside correction, as anticipated from the following analysis, the pair has continued to melt to the downside:

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Live market, 4-hour

The Fibonacci retracements are based on the 4-hour correction's range. 

Live daily and weekly charts

Meanwhile, there is a confluence of support around 0.7710 on the daily and weekly charts as follows:

On the weekly chart, we have a W-formation and the price would be expected to restest the neckline at 0.77125.

On the daily chart, we have the target area meeting the 21-day moving average.

0.77+ is a highly liquid area

However, it is worth noting that the daily 10-day moving average and the point of control of the recent upside at 1.7030 is a firm support with the price having already made a 78.6% Fibonacci retracement of the daily correction. 

The 0.77 area has been a strong live of liquidity for 2021, so it would be expected to be a tough level to crack to the downside.

If the bulls hold these initial tests, then the upside extension of the weekly impulse to 0.7890 would be expected following the recent weekly 38.2% retracement. 

Reverse H&S in the making

In this scenario, a weekly bullish reverse Head & Shoulders will have formed.

However, on a break of the target area and Point of Control and then 0.7700, there is little in the way of volume all the way back to 0.7650 and then 0.7620. 

In any case, a break to 0.7656 would only raise the prospects of a deeper right hand shoulder of the expected bullish reverse H&S weekly pattern.