AUDUSD at the bottom of long-term Channel Down. Critical test!
The AUDUSD pair has been trading within a long-term Channel Down pattern since the February 25 2021 market top. As we pointed out on our previous analysis on this pair, the trend remains bearish unless we get a candle closing above the 1D MA200 (orange trend-line):
In fact as you see, we got an emphatic rejection on the 1D MA200 instead, the 2nd within this 1.5 year long Channel Down pattern. Right now the price is on the Lower Lows (bottom) trend-line of this pattern, having marginally broken below the 0.67780 Gap. A closing below the Channel opens the way for the next Gap around 0.64000, in a similar sell-off fashion as the March 2020 break-down.
As a result, a tight SL buy here is most optimal with low risk, targeting the 0.5 Fib (middle of Channel Down) and then break-out but if we close above the 1D MA200. But if the SL gets hit be quick to reverse to a sell targeting the 0.6400 Gap but take no risk, constantly moving the SL on break-even/ then on profit.
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In fact as you see, we got an emphatic rejection on the 1D MA200 instead, the 2nd within this 1.5 year long Channel Down pattern. Right now the price is on the Lower Lows (bottom) trend-line of this pattern, having marginally broken below the 0.67780 Gap. A closing below the Channel opens the way for the next Gap around 0.64000, in a similar sell-off fashion as the March 2020 break-down.
As a result, a tight SL buy here is most optimal with low risk, targeting the 0.5 Fib (middle of Channel Down) and then break-out but if we close above the 1D MA200. But if the SL gets hit be quick to reverse to a sell targeting the 0.6400 Gap but take no risk, constantly moving the SL on break-even/ then on profit.
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** Please support this idea with your likes and comments, it is the best way to keep it relevant and support me. **
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