Hi Traders! AUDUSD short term forecast follow up and update is here. On August 10th I shared this “AUDUSD Technical Analysis And Short Term Forecast” post in our 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 was moving lower has created a bullish divergence that has formed between the first low that has formed at 0.69159 and the second low that has formed at 0.68695 based on the MACD indicator. Also, we could see that the price then moved higher and has created higher highs based on the MACD indicator, which is a sign of gaining momentum towards the bullish side. Currently, it looks like a correction is happening, also we had two strong resistance zones that has formed and the price which was moving higher has broken above these zones and is holding above them. After the breakout these strong resistance zones are acting as two strong support zones for us. There are two possible scenarios from here, the price might move higher from the current zone or alternatively if it moves lower then the next area to look for bullish setups with bullish evidences would be the second strong support zone. Until both these strong support zones shown in the image below(marked in blue) holds my short term view remains bullish here and I expect the price to move higher further.
AUDUSD H1(1 Hour) Chart Current Scenario
Based on the above-mentioned analysis my short term view was bullish here and I was expecting the price to move higher further until the two strong support zones hold. The price action followed my analysis here exactly as I expected it to. After the higher highs, we had a pullback and the price which was moving lower reached the first strong support zone, respected it and then it bounced higher from this zone. The price then moved higher further and delivered 170+ pips move to the upside, until it was blocked by a bearish divergence.
On the M15 chart, the market provided us with various facts supporting the bullish view. The price which was moving lower created a bullish divergence between the first low that has formed at 0.69527 and the second low that has formed at 0.69466 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. Then as you can see in the image below how the price moved higher after that and provided a nice 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 to us and took the right action according to that.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
