AUD/USD rallied in the last days, but remains to see if this will be a larger upside movement or a temporary rebound. Personally, I believe that we may have another retreat after the current bullish momentum.

It is very important to see what will really happen on the USDX on the short term. The dollar index has slipped below an important dynamic support, so, technically, it could drop much deeper in the upcoming days. A USDX’s further drop will force the USD to lose more ground versus the Aussie and versus the other major currencies.

The rate is trading in the green right now but remains to see what will happen and how it will react after the tomorrow’s Australian and US data.

The US FOMC Meeting Minutes will definitively bring a high volatility, so you should be careful. The US Existing Home Sales are expected to increase from 5.38M to 5.44M, a larger increase will help the USD. On the other hand, the Australian Construction Work Done indicator could increase by 0.9%, beating the 0.2% growth in the former reading period.

The rate has increased significantly after the retest of the median line (ML) of the major descending pitchfork and after the failure to close near this dynamic support. Right now is almost to reach the upside 50% Fibonacci line, which represents a very strong dynamic resistance.

AUD/USD is trapped within a potential Falling Wedge pattern, so only a valid breakout could signal a further increase. I’ve drawn an ascending pitchfork hoping that I’ll catch a bullish momentum. The rate has increased and has managed to make an aggressive breakout through the median line (ml) of the minor ascending pitchfork.

Maybe the rate will come back to test and retest the median line (ml) before will increase further, so right now will be better for you to stay away and wait for a fresh trading signal.