AUD/USD Price Analysis: Bulls are trapped, 0.6950 eyed before further downside potential to test below 0.6800

• AUD/USD bears are stalling, for now, and there are eyes on 0.6935 with the 38.2% Fibonacci around 0.6950
• Bears eye a break of 0.6905 to open the price imbalance below and a run to 0.6800 and 0.6750 below there. 

AUD/USD bulled in breakout traders when the price broke 0.7000 and reached the 0.7060s. At this juncture, the peak formation is starting to get locked in but there needs to be a break below 0.6900 to seal the prospects of a prolonged downtrend. 

The following illustrates such a scenario from a bearish bias looking at the daily and short-term timeframes.

AUD/USD daily charts

The M-formation is a topping pattern and while there are still prospects of a test higher to the neckline near 0.6950, the bias is to the downside with the trendline support eyed on the way to 0.6850. A break of this area opens the risk of a move to test below 0.6800. 

AUD/USD H4 chart

We have seen a move below the rising channel and there is a price imbalance (PI) on the way to 0.6935 with the 38.2% Fibonacci around 0.6950. If the bears commit there at a premium, then there will be prospects of a break below the current support of 0.6905 to open the price imbalance below and a run to 0.6800 and 0.6750 below there.