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Technical Analysis – AUD/USD creates a bearish triangle

AUD/USD 08May19 | EconAlerts

AUD/USD finds strong support at a 4-month low; creates a bearish triangle.

AUD/USD is looking more positive as prices have climbed above the 0.7000 level after bouncing off the four-month low of 0.6960, however, it is creating a descending triangle formation starting from 0.7390 and finding significant support at 0.6960 over the last five months.

Currently, the pair is hovering near the red Tenkan-Sen line with the technical indicators suggesting a possible upside correction. The RSI indicator is sloping upwards in the negative territory, while the stochastic oscillator is moving higher after it posted a bullish cross between the %K and %D lines in the daily chart.

Should the pair extend its positive move, the next resistance could come around the 23.6% Fibonacci retracement level of the down leg from 0.8135 to 0.6746, around 0.6960. Slightly above this hurdle, the bearish cross within the 20-and 40-simple moving averages (SMAs), as well as the lower surface of the Ichimoku cloud, is taking place near 0.7090. Even higher, the price could meet resistance at the falling trend line of the triangle pattern around 0.7150.

Otherwise, if there is a break of the strong support of 0.6960, the price could touch 0.6825, taken from the low on January 2016, before meeting the ten-year low of 0.6746.

Summarising, in the short-term, the price is turning slightly bullish, though, in the medium-term, we are expecting more losses once if there is a daily close below the descending triangle.


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Disclaimer:
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.


Source: XM

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