AUDUSD has practically been caught in an Ascending Channel for most of this year but that might not be for "Long"!A few key things to point out:
- Early April delivered a False Breakout where Price reached the Previous 5 Year Low @ .5980 and was immediately sent back up into the Channel! (Liquidity Sweep??)
- Most of the Price Action that's occurred in this range has been contained to the Upper Chamber of the Channel between the Rising Resistance and Linear Regression.
- Price Consolidated tightly into a Pennant Pattern underneath the Rising Resistance for the past few weeks before delivering a Bullish Break just earlier this evening.
If Bulls are able to sustain Price outside the Channel, this could generate potential Long Opportunities on the Retest of the Break of the Ascending Channel!
Once a Breakout is validated and Retest is successful, the Price Target would be the Next Swing High @ .66875 where Bears were able to push Price down last.
Fundamentally, RBA will be releasing CPI y/y numbers on Tuesday, May 27th with analysts forecasting a .1% Decrease in Inflation from 2.4% to 2.3% after last week having made a 25 basis point rate cut from 4.1% to 3.85%.
Note
Here is the Pennant Pattern on
AUDUSD broken down on the 4Hr Chart where we see Price was successfully supported by the Rising Support 3 times suggesting a Strong Trendline but the Falling Resistance only held Price twice and made a Breakout for the 3rd attempt!Based on the requirements of the True or False Formula, the Breakout is considered Validated and True!
Bulls were able to secure a new Higher High @ .6537 then that of the Previous High that started the Pattern @ .6514.
We will want to watch for the retracement that will bring Price down to Retest the Break of the Pennant!
Note
Price was rejected back down when attempting to break out of the Channel and formed a Head & Shoulders pattern sending Price back within the Pennant!
This turns our Bullish Bias into a Bearish one!
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Novi's Trading Channel
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Related publications
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For All Things Currency,
Keep It Current,
With Novi Fibonacci!
Novi's Trading Channel
t.me/+l3fTcsZu91ZiZDkx
Keep It Current,
With Novi Fibonacci!
Novi's Trading Channel
t.me/+l3fTcsZu91ZiZDkx
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.