Technical outlook:

The daily chart view presented for AUD/USD is suggesting that the current drop that began in January 2018 from 0.8130 levels is nearing a major price support and Fibonacci 61.8% extension near 0.7500 levels as shown here. Please note that while dropping lower for last 4 months, the pair has broken below its 1-year support trend line and is also looking to take out the price support near 0.7500 levels, before pulling back. Traders who are holding short positions, should prepare to book profits for now and remain flat; while aggressive traders should be preparing to turn bullish for a potential counter trend rally. Looking into the wave counts, the current drop has unfolded into 3 waves until now. Hence chances remain for a continued rally as well. It is still unclear whether AUD/USD is wanting to drop into 5 waves or not. It can be only confirmed in the coming sessions where the counter trend rally would end.

Trading plan:

Prepare to take profits on short positions taken earlier. Aggressive traders prepare to go long around 0.7500 levels with a tight stop.

Fundamental outlook:

Watch out for German consumer Price Index and US PCE Core at 08:00 AM EST and 08:30 AM EST, respectively.