Let’s close out the trading week with a couple of short-term channels on AUD/CHF and AUD/NZD in today’s intraday charts update.
As y’all can see, AUD/CHF has been trending lower recently. And if we connect the most prominent peaks and troughs, we can see that the pair has been trading while trapped inside that there descending channel.
As y’all should know by now (since I keep reminding y’all every once in a while), one of the more conservative ways to play a descending channel is to look for an opportunity to go short when the pair is at or close to the channel’s resistance area.
And as luck would have it, that’s where the pair is currently at. In addition, the channel’s resistance area is just above the area of interest at 0.7490. Moreover, stochastic is already signaling overbought conditions and all that. There’s therefore a good chance that resistance will hold and that the pair may be moving back down soon.
Do note, however, that the recent upswing’s momentum is rather strong. Also, the pair failed to test the channel’s support area during the most recent downswing, which means that bears may be losing steam. There’s therefore also chance that the pair may stage an upside channel breakout. And if that happens, then y’all may wanna bail yo shorts, especially if the pair clears 0.7540.
Like AUD/CHF earlier, price action on AUD/NZD has also been tilting to the downside. And like AUD/CHF, a descending channel has formed on AUD/NZD’s 1-hour forex chart.
Also like the earlier setup on AUD/CHF, the pair is currently testing the channel’s resistance area, so y’all may wanna start lookin’ for a chance to go short on the pair.
Do note, however, that stochastic is signaling oversold conditions. There’s therefore a higher-than-average chance that the pair may stage an upside channel breakout.
And if an upside channel breakout does happen and the pair clears 1.1140, then that likely means that them bulls are gunning for 1.1290. Y’all may therefore wanna bail yo shorts then, or even switch to a bullish bias.
In any case and as usual, just make sure to practice proper risk management as always, a’ight? Peace! See y’all again next week!