Whether you like trading ranges or reversals, I’ve got something for you on today’s set!
Check out these inflection points on GBP/CHF and AUD/CAD.
This pair has been on a tear recently, but its rally might be cut short once it hits the top of its range.
Will sellers return soon?You see, GBP/CHF has been moving sideways between the 1.2150 minor psychological mark and the 1.2400 handle since last month, and technical indicators are hinting that the ceiling could hold again.
The 100 SMA is below the 200 SMA to suggest that the path of least resistance is to the downside while Stochastic is in the overbought zone to reflect exhaustion among buyers.
If the top of the range holds, GBP/CHF could make its way back down to the bottom of the range once more. A break higher, on the other hand, could set off a climb that’s the same height as the rectangle pattern.
Is that a reversal pattern I’m seeing on the 4-hour chart of AUD/CAD?The pair appears to have completed a head and shoulders formation and is currently testing the neckline around the .9350 minor psychological level.
Breaking below this support area could trigger a drop that’s the same height as the formation, which spans roughly 150 pips.
However, technical indicators are pointing to another bounce off support. The 100 SMA is above the 200 SMA dynamic support, which lines up with the neckline to add to its strength as a floor. Also, Stochastic is hanging out in the oversold area, so turning higher would signal that buyers have the upper hand.
In that case, there’s still a chance AUD/CAD could bounce back to the highs near the .9500 major psychological mark and beyond!