Societe Generale FX Technical Strategy Research notes that sine last year, AUD/USD has been evolving within a large base formation in the form of an inverted head and shoulders.
On the upside, SocGen notes that the recovery in the pair has been faltering near 0.7730/0.7830, the 23.6% retracement from 2011 highs and the neckline of the aforementioned formation.
Short term, SocGen expect a pullback to drift towards the lower limit of a broad triangle around 0.73. This, according to SocGen, should be a prominent support and a clear break below should open the the door for testing a multiyear trend at 0.71/0.7065.
AUD/USD is trading circa 0.7420 as of writing.
Source: Societe Generale Cross Asset Research
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