A new higher and wider box...
If you ever had a cat, you know that cats like boxes. We never see ours (she is a skitty kitty), but if we go searching for her, we can often find her in a box like area.
Cats feel comfortable in a box (or even square area). The walls are confining. It is comforting. They don't need a whole lot of room. Cats will make that box their home, until they decide to go to another box (then that box becomes their new home).
The AUDUSD is acting like a cat.
Yesterday, the pair broke out of its box that confined the pair for over 5 trading days. That box was confined to 47 pips. There were 4 separate test of the upper extreme (see red circles). The break has led to the pair moving to another box. This box is wider at 68 or so pips.
Admittedly, this box is only a little over a day old, but there already are multiple tests of the top extreme and bottom extreme. Moreover, the low extreme from today, stalled at the high extreme from the "old, lower box" (i.e., the period from June 7 to yesterday before the break above 0.7566). The market is really comfortable in the boxes it has created.
What spoils the party?
A break outside of the box.
For cats, it is comfortable staying in a box, any box, but it will move to another one eventually.
For traders, there are times when the market finds comfort in boxes too, but then moves outside the box.
The low extreme of the current box was retested in the last hour's bar. That level held. The buyers are leaning against the extreme. Stay above is more bullish. Traders can look toward 0.7600 and then the high box extreme at 0.7635 as the upside targets.
Move below the box low (at 0.7566), and the price moves outside the box and traders change their bias to more bearish. The 100 hour MA at 0.7557, the 200 hour MA at 0.7539, 100 day MA at 0.7530 and the low extremes from the lower box, become the downside targets.