AUD/USD (daily chart shown below) hit a new four-and-a-half year low on Wednesday as the embattled currency pair continued to decline towards its downside support target at 0.8100. Not since mid-2010 has the currency pair traded at such depths.
This new multi-year low comes after a full month of almost continuous declines and three months of a new bearish leg within a long-term downtrend.
In early September, AUD/USD resumed its long-term downtrend after a prolonged period of range trading.
Since early September, the currency pair has experienced major downside moves, interrupted by a large bearish pennant pattern during the month of October.
After breaking down below that pennant pattern, price action hit its 0.8600-area support target, and then fell further to hit its next downside support target around the 0.8300 level early last week.
Having dropped even further below 0.8300 within the past week, AUD/USD has clearly confirmed the acute strength of its entrenched downtrend.
With upside resistance now residing around the broken 0.8300 level, the next major downside target resides at the noted 0.8100 support level. Below 0.8100, there is very little in the way of key support levels until the 0.7700 price area.
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