AUD/USD Possibly Turning in Bearish Channel

AUD/USD Key Points

• Within a bearish channel, AUD/USD is possibly printing a top.
• AUD/USD has run into higher time frame resistance.
• AUD/USD has failed to make an intraday higher high, opening up an opportunity to look for short positions.

AUD/USD Technical Analysis

After the low liquidity induced flash crash that rocked the Aussie last week, price has steadily climbed back. With price now hitting the first significant, previous higher time frame level of support, the possibility of building a short position is in play.

The daily chart highlights the bearish channel that AUD/USD is currently in the midst of and shows even in times of total irrationality such as a flash crash, that levels like this are still respected.

After hitting the bottom of the channel, price has predictably bounced back up and now comes to a significant zone that previously acted as support. It's here that I now expect sellers to come to the fore.

Taking a step down and zooming into the 15 minute chart, you can see the price structure that I've outlined in the above key points. Keep in mind that the thick red lines represent the higher time frame zone and the thin red lines are intraday levels.

Price has stalled within the higher time frame zone and I'm now looking to sell short term rallies back into previous support that I expect to turn to resistance intraday.

Depending on how you want to play the setup, it should provide tight risk:reward and at least put you in a good position to make money off the trade. Which is of course all you can ask for in this game.

Best of probabilities to you!

Economic Releases to Watch Today

• JPY - Bank Holiday
• AUD - MI Inflation Gauge m/m