AUD/USD 1H Chart: Channel Down

Here the 200-hour SMA played a major role in forming the pattern, unlike in GBP/JPY discussed on the previous page. We may also extend the falling trend-lines further into the past (beyond the last 100 bars) and see that they were respected by the market earlier as well, meaning it should take bulls a lot of effort and time before they can claim the level above the upper boundary of the downward-sloping corridor. As for the technical indicators, for the most part they are giving ‘sell' signals, but we must be aware of the extremely bullish sentiment of SWFX market: 73% of positions are long, meaning that we could be approaching a bottom.