H1 BEARISH FLAG FORMING AFTER MONTHLY DEMAND GIVES WAY
AUD/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Overwhelmed by the effects of the coronavirus pandemic, demand at 0.6358/0.6839 and 0.6094/0.5866 yielded last week, scoring seventeen-year lows at 0.5506.
Recent movement, therefore, exposed another layer of demand at 0.5219/0.5426, potentially enticing further selling over the coming weeks, in line with the primary downtrend, lower since 2011.
Daily timeframe:
Partially altered from previous analysis -
In recent movement, price action whipsawed through supply-turned demand at 0.5664/0.5798 and tested a well-grounded support level at 0.5563. Meanwhile, to the upside on this timeframe, the unit remains capped by a notable demand-turned supply base at 0.5926/0.6062, which contained downside (as demand) in October 2008.
With reference to the RSI indicator, we are trading from unparalleled oversold levels right now, with the value seen bottoming off 10.00, currently trading at 20.00.
H4 timeframe:
Brought forward from previous analysis -
As we fade seventeen-year lows, focus on the H4 timeframe remains on newly formed supplies. The latest area to grace the charts falls in around 0.6036/0.5978, which entered the fold on Friday, forcing moves to lows of 0.5746 into the close.
Above 0.6036/0.5978, technical research reveals another layer of supply rests nearby at 0.6147/0.6078, with a break exposing support-turned resistance at 0.6314.
H1 timeframe:
AUD/USD eked out marginal gains Monday, adding more than 15 points, or 0.32%.
Technically, though, the H1 candles spent the entire session compressing within a potential bearish flag pattern (0.5699/0.5808 – green). What’s also notable is price currently mingling with the 100-period SMA and recently toppling 0.58 to the upside.
Meanwhile, technical indicators has the RSI holding above 50.00.
Structures of Interest:
The break of monthly demand at 0.6094/0.5866 commands attention, suggesting additional loss could be on the cards to demand at 0.5219/0.5426.
Daily price offers an indecisive tone, while H4 action remains south of supply at 0.6036/0.5978.
Given the position of monthly price at the moment, a H1 bearish flag breakout will likely be viewed as a strong bearish theme. Traditionally, take-profit targets for flag patterns are calculated via the preceding move added to the breakout point, often generating attractive risk/reward.
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Overwhelmed by the effects of the coronavirus pandemic, demand at 0.6358/0.6839 and 0.6094/0.5866 yielded last week, scoring seventeen-year lows at 0.5506.
Recent movement, therefore, exposed another layer of demand at 0.5219/0.5426, potentially enticing further selling over the coming weeks, in line with the primary downtrend, lower since 2011.
Daily timeframe:
Partially altered from previous analysis -
In recent movement, price action whipsawed through supply-turned demand at 0.5664/0.5798 and tested a well-grounded support level at 0.5563. Meanwhile, to the upside on this timeframe, the unit remains capped by a notable demand-turned supply base at 0.5926/0.6062, which contained downside (as demand) in October 2008.
With reference to the RSI indicator, we are trading from unparalleled oversold levels right now, with the value seen bottoming off 10.00, currently trading at 20.00.
H4 timeframe:
Brought forward from previous analysis -
As we fade seventeen-year lows, focus on the H4 timeframe remains on newly formed supplies. The latest area to grace the charts falls in around 0.6036/0.5978, which entered the fold on Friday, forcing moves to lows of 0.5746 into the close.
Above 0.6036/0.5978, technical research reveals another layer of supply rests nearby at 0.6147/0.6078, with a break exposing support-turned resistance at 0.6314.
H1 timeframe:
AUD/USD eked out marginal gains Monday, adding more than 15 points, or 0.32%.
Technically, though, the H1 candles spent the entire session compressing within a potential bearish flag pattern (0.5699/0.5808 – green). What’s also notable is price currently mingling with the 100-period SMA and recently toppling 0.58 to the upside.
Meanwhile, technical indicators has the RSI holding above 50.00.
Structures of Interest:
The break of monthly demand at 0.6094/0.5866 commands attention, suggesting additional loss could be on the cards to demand at 0.5219/0.5426.
Daily price offers an indecisive tone, while H4 action remains south of supply at 0.6036/0.5978.
Given the position of monthly price at the moment, a H1 bearish flag breakout will likely be viewed as a strong bearish theme. Traditionally, take-profit targets for flag patterns are calculated via the preceding move added to the breakout point, often generating attractive risk/reward.
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