Selling AUDUSD to 0.6090 following Bearish 5-0 pattern activation

AUDUSD began declining on Tuesday, following a strong 0.5% rally in the previous session. The pullback reflects the US dollar strength amid easing global trade tensions.

US President Donald Trump expressed willingness to reduce tariffs on Chinese goods. In response, Beijing exempted some US imports from 125% duties. These moves have boosted hopes for de-escalation in the long-running trade confrontation between the world's two largest economies.

From a technical perspective, AUDUSD is trading in a wide range on the daily chart (D1). The latest upward impulse formed a complex Bearish 5-0 pattern, a reversal formation signaling the potential end of the uptrend and the beginning of a downward phase.

Completion of this pattern suggests a potential reversal zone between 0.6420–0.6480. With price approaching the range's upper boundary, this may signal the start of a downward correction.

The 0.6420 level is a mirror level. Previously, it acted as support, and now serves as resistance. Price is testing this level, and its reaction here may prove decisive.

The RSI indicator has entered the overbought zone (above 70), signaling a potential downward reversal. Simultaneously, the slowing RSI momentum suggests weakening bullish pressure.

In candlestick analysis, candles with long upper shadows are forming at the peak of the current move. This shows buyer indecision and a potential trend reversal.

As long as the pair stays below 0.6480, the primary scenario favors a downward reversal. However, a break above this level could trigger a continuation of the upward correction.

Short-term prospects for the AUDUSD pair suggest selling, with the target of 0.6090. Part of the profit should be taken near the level of 0.6270. A Stop loss could be set at 0.6590.

Since the bearish scenario is short-term, the trading volume should not exceed 2% of your total balance to reduce risks.