AUD/USD 4H Chart: Channel Up

Soon after bottoming out late January around 0.8660, the Australian Dollar managed to recuperate by gaining a foothold above the long-term moving average and at the same time formed a neat bullish channel.

And while the daily technical indicators, in conjunction with the strongly bullish sentiment towards AUD/USD (65% of positions are long), propose that the recovery will continue, there is a risk that the trading range will narrow, leading to emergence of the rising wedge pattern, which means a high probability of a decline. This course of events is also implied by the weekly studies, as five out of eight are presently giving ‘sell' signals.