Strategy: Flat
AUDUSD broke out of a well-defined falling channel after putting in a bullish Piercing Line candlestick pattern above support at 1.0249, with prices now seemingly forming a descending triangle. The setup is classically associated with bearish continuation, but that is difficult here considering “continuation” would imply a move higher, whereas the downside bias would mark a reversal. With that in mind, we will stand aside and withhold judgment until the pattern is resolved with either a break above is upper boundary (now at 1.0376) or below support at 1.0311.
Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
To be added to Ilya's e-mail distribution list, send a note with subject line "Distribution List" to ispivak@dailyfx.com
