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AUDUSD broke higher recently, up into wave C-circled that is part of a big corrective wave IV which looks like a flat. A flat correction is a 3-3-5 pattern; a contra-trend movement that should send the price back to the downside after a completion. That said, despite higher prices traders will have to be aware of a bearish turning point. We can already see the price in red wave 5), on the final part of wave C-circled that could be looking for a top this week at 0.7800-0.7900 area.

AUDUSD, Daily

audusd d

On the lower time frame, we can see that AUDUSD did not move much in the last few days, so it looks like the momentum is decreasing but still the pair managed to reach new highs recently. However, we see limited gains as the pair may be making an ending diagonal in wave 5) which is a very powerful reversal pattern. That said, a strong bearish turning point may occur this week, ideally from around 0.7870-0.7900 area. Once we will get five waves of decline we will start to look for resumption of a big downtrend from the larger charts; weekly, daily.

AUDUSD, 4H

AUDUSD 4 (2)