Hi Traders! AUDJPY forecast follow up and update is here. On November 24th I shared this “Technical Analysis – AUDJPY Short Term Forecast” post in my blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
My Idea
“On the H1 chart, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows which we may consider as evidence of bullish pressure. In addition to this the ADX indicator gave a bullish signal here as well at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as another evidence of bullish pressure. We also had a strong resistance zone that had formed which the price has broken above and currently, this strong resistance zone is acting as a strong support zone for us. Until this strong support zone holds my view remains bullish here and I expect the price to continue higher further in the short term”.
AUDJPY H1(1 Hour) Chart Current Scenario
Based on the above – mentioned analysis my view was bullish here and I was expecting the price to continue higher further until the strong support zone holds. The price action followed my analysis exactly as I expected it to and moved higher further delivering around 110+ pips move so far.
The market provided us with various facts here supporting this bullish view. We had a pullback with the price creating a bullish hidden divergence between the first low that has formed at 75.821 and the second low that has formed at 76.563. The price then created a continuing bullish divergence between the first low at 76.563 and the second low at 76.448 based on the MACD indicator. We may consider these as facts provided by the market supporting the bullish view. In addition to this we had a bullish engulfing candle pattern and the strong support zone was holding and there were no signs opposing this bullish view. The price then moved higher further and provided an amazing move to the upside.
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted us and took the right action according to that.
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To your success,
Vladimir Ribakov
Certified Financial Technician
