Forex traders bullish on the pair keep trying to push past resistance around the 1.3170 handle but end up failing every time. The bulls are relentless, though, which is why the pair has been making higher lows recently, and as a result, a pretty sweet-looking ascending triangle has formed. The moving averages may be oscillating, but if you zoom out of the chart or move higher to the 4-hour forex time frame, you can easily see that the overall trend is still up. And if you add the fact that an ascending triangle is a bullish forex chart pattern, then we can pretty much conclude that our main directional bias is to the upside. Still, there always a chance that price will breakout to the downside, so prudent forex traders should prepare for such a scenario too.
It looks like a symmetrical triangle has formed on AUD/CAD’s 1-hour forex time frame. As a symmetrical triangle forex chart pattern, we don’t really have a directional bias since an upside breakout is just as likely to occur as a downside breakout. Moreover, the moving averages have been oscillating and price has been moving sideways since the end of March, so we really don’t have any clues on where price will breakout. Stochastic seems to favor an upside breakout, for now at least, since it is currently in oversold territory, which indicates that forex traders bearish on the pair may be exhausted already. In any case, if this pattern does pop, then we’ll probably see a 300-pip move since that is roughly the height of the triangle.
I’ve identified yet another ascending triangle for us to study. This time, we’re looking at GBP/CAD’s 1-hour forex chart. The long-term trend is still up, so our primary directional bias is to the upside. The only worrying thing is that there seems to be a bearish divergence between price action and the stochastic oscillator, which means that there’s also a good chance that price will break to the downside, so make the necessary preparations. As usual, make sure to practice proper risk management should you find a trade based on this or any of the other charts.
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To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis. Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.AUD/CAD 1-hour Forex Chart