AUDJPY reaching critical resistance

I’m bearish for the AUDJPY for a few reasons. First of all the pair is reaching a critical resistance zone on the daily chart. Next there is bearish hidden divergence forming again on the daily chart along with band-to-band move on the bollingers. Is it classical band-to-band? For sure not but it is still one so we consider it as well. Dropping to the H4 chart we see that there is already bearish divergence. The plan is to wait for the price to push a bit higher near the 94.20-50 range and look for sell entry.

Technical Analysis:

D1 – major resistance zone, band-to-band move on the bollingers, hidden bearish divergence

H4 – bearish divergence, up trend line

Entry:
H4
Scenario 1:
We can try to sell on the H4 chart once the bearish divergence completes. This means we want to see a bearish candle pattern within the 94.20-50 zone.
Target 1: H4 20 MA
Target 2: 92.40
Stop Loss: above last high created

Scenario 2:
Alternatively and more conservative approach would be to wait for the up trend line to be broken along with the most recent support level.
As a target we can use 20 MA of the daily chart.

Video Explanation

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