AUDUSD – Dip buying in the corrective channel
Monthly: Holding within a large Expanding Wedge formation that has an eventual bias to break to the downside. The whole move higher from the 2016 low (0.6827) has been and volatile, common in corrective formations
Weekly: The mixed and volatile price action formed an Ending Wedge pattern (118 weeks of mixed results). We broke the trend of higher lows on week 23rd April. Reverse trend line resistance has been rested at 0.7675. Although we traded to the lowest level in 57 weeks, all of last week’s initial losses were recaptured resulting in an indecisive Doji style candle being posted.
Daily: Broke out of the channel formation to the downside. Strong selling pressure resulted in the previous support level of 0.7412 being broken. However, the daily chart posted both a ‘perfection 9’ and ‘exhaustion 13’ (DeMark), often an indication that the current trend is coming to an end. Another important factor in this time frame is we have bespoke resistance in-line with the reverse trend line at 0.7574, a prime long target area.
Intraday (1-hour) – Looks to be forming a corrective channel or Flag pattern. Trend line support is located at 0.7388, in between the 50 and 61.8% pullback level. This is our prime long entry area.
Intraday (2-hour) – Highlights a potential bullish Elliott Wave formation. We look to buy dips