AUD/USD stays on course for a test of major support at 0.7121/06 – Credit Suisse

AUD/USD remains in a short-term range above support at 0.7221/19. Nonetheless, economists at Credit Suisse stay mildly biased towards a test of major long-term support at 0.7121/06.

Scope for further short-term weakness towards major support at 0.7121/06

“We stay biased lower, with key short-term support still seen at the corrective price low at 0.7221/19, below which would open up a test of much more major support starting at 0.7121/06, which is the ‘neckline’ to a major potential top and stretching down through 0.7053 to 0.6991. This area includes the 38.2 retracement of the 2020/21 rise and the major November 2020 price low.” 

“First resistance stays at 0.7289, which continues to cap the market into the close, then 0.7347, above which would negate the recent bearish ‘outside day’” and help to stabilize the market.” 

“Only above 0.7408/10 would turn the risks higher.”