Chart of the day AUDUSD short term mean reversion rebound remains intact

Short-term technical outlook on AUD/USD (Thurs, 24 May)

Key technical elements

Since its 09 May 2018 low of 0.7410, the AUD/USD had managed to inch high to print a recent high of 0.7605 on 22 May 2018. The recent rebound has surpassed the 38.2% Fibonacci retracement of the down move from 19 Apr 2018 swing high to 09 May 2018 low. In addition, the daily RSI oscillator still has some room left to manoeuvre to the upside before it reaches its corresponding significant resistance at the 55% level (see daily chart).
In shorter-term, the AUD/USD has started to evolve into a minor bearish “Ascending Wedge” configuration with its lower boundary now acting as a support at 0.7520. The upper limit of the minor “Ascending Wedge” stands at 0.7625 which confluences closely with the 0.7655 pull-back resistance of the former major “Ascending Wedge” support from Jan 2016 and the 50%/61.8 % Fibonacci retracement of the recent decline from 19 Apr high to 09 May 2018 low (see 1 hour chart).
The hourly RSI oscillator remains positive above its corresponding support at the 40% level which indicates that short-term upside momentum of price action remains intact.

Key Levels (1 to 3 days)

Intermediate support: 0.7540

Pivot (key support): 0.7520

Resistances: 0.7625 & 0.7655

Next supports: 0.7450 & 0.7415

Conclusion

Therefore as long as the 0.7520 key short-term pivotal support holds, the AUD/USD may see a further potential push up to target the next resistances at 0.7625 follow by 0.7655 next within its short-term mean reversion rebound phase.

However, failure to hold at 0.7520 invalidates the short-term mean reversion rebound to see a continuation of its medium-term downtrend to retest 0.7450 and the 09 May 2018 swing low of 0.7415 in the first step.

Charts are from eSignal

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