The sellers are bitterly defending the resistance area around the 0.9500 major psychological level, but the buyers are firmly convinced that they are in the right, resulting in higher lows and relatively flat peaks, which means that an ascending triangle has now formed. An ascending triangle is a bullish forex chart pattern, so our main directional bias is also to the upside. The moving averages look promising too since they are alredy in uptrend mode, and the 100 SMA is even acting as dynamic support. Be careful, though, since the Fibonacci retracement setup that we identified on Monday might still be in play. Furthermore, the 0.9500 major psychological level has seen very significant market interest, as highlighted by the rectangle.
After breaking past support at the 0.7270 handle, price sank lower until it got rejected at the 0.6900 major psychological level. Forex traders who were bearish on the pair refused to give up without a fight, however, and so an ascending channel has clearly formed on AUD/USD’s 1-hour forex chart. Y’all probably know by now that the most conservative way to play an ascending channel is to look for support near the bottom. And since price is currently near the top of the channel, then that means that this setup is clearly a counter-trend setup, so only forex traders who are gangsta enough may want to take on this trade. In any case, price is currently back at the previous support area around the 0.7270 handle, so the pair may be moving back down again soon. Also, stochastic has just reached the overbought region, so forex traders who are bullish on the pair may become exhausted soon enough.
If the previous ascending channel setup is just too aggressive for you, then check out this one. As y’all can see, price is currently milling about at the bottom of the channel. And looking at our technical indicators, it’s clear that the moving averages are still in uptrend mode, with the 100 SMA acting as dynamic support to boot. Stochastic, meanwhile, is moving closer to the oversold territory, so perhaps forex traders who are bullish on the pair may start nibbling-in soon.The only worrying thing is that price is currently at the 1.1300 major psychological area, which is a price area of very significant market interest, so there’s also a good chance that price will use the 1.1300 level as a launching pad to drive the pair lower instead. Anyhow, just 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