EURAUD Triangle Breakout
Market Condition: Pending Breakout
Target 1: .5x Triangle Width (500 pips)
Target 2: 1x Triangle Width (1001 pips)
Invalidation: Continued Consolidation
EURAUD 1Day Chart
(Created using Marketscope 2.0 Charts)
After a bullish advance from April to August this year, the EURAUD has currently been consolidating in a descending triangle pattern. Triangles allow traders to plan for a potential breakout above resistance or below support. Current resistance is found at the September 17th high at a price of 1.5961. Support is marked by the August 28th low at 1.5584. In the event that a breakout does occur, traders can then being looking for a 1001 pip projection for the pair. This value is found by measuring the width of the triangle from the high (1.6585), to the previously mentioned low.
In the event that prices fail to breakout to a new high or low, and the EURAUD continues to trade between support and resistance, it would tentatively delay the execution of any breakout based entry orders. Conversely, once price moves beyond either support or resistance, any move back inside of the defined triangle may invalidate the breakout.
To Receive Walkers’ analysis directly via email, please SIGN UP HERE
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.