AUDUSD Channel Down
This pair is in consolidation, moving down a channel established in March 2021.
Why a consolidation ?
Look to past impulsive moves - magnitude is 2500 - 3800 pips and the duration is on average is 20 - 28 bars ( exception of the GFC and Pandemic crash) .
So far the Channel movement has been 1250 pips over 17 bars. Seems slow and progressive.
What do you see happening next ?
Much the same, as price meanders down towards .6500.
The GFC low around .6000 seems a stretch and too low, even with a bearish overshoot.
Timeframe ?
It is hard not to see an inverse H&S setting up here.
Based on this time projections are placed for development of a right shoulder - the pair reach a low by April 2023
and the right shoulder completed in July 2024 (51 bars).
Fundamentally this would seem possible, as over time the Fed is likely have gone too far and fast with rate hikes (probable recession ). They will need to once
again stimulate the economy and unwind rates and reintroduce QE.
Why a consolidation ?
Look to past impulsive moves - magnitude is 2500 - 3800 pips and the duration is on average is 20 - 28 bars ( exception of the GFC and Pandemic crash) .
So far the Channel movement has been 1250 pips over 17 bars. Seems slow and progressive.
What do you see happening next ?
Much the same, as price meanders down towards .6500.
The GFC low around .6000 seems a stretch and too low, even with a bearish overshoot.
Timeframe ?
It is hard not to see an inverse H&S setting up here.
Based on this time projections are placed for development of a right shoulder - the pair reach a low by April 2023
and the right shoulder completed in July 2024 (51 bars).
Fundamentally this would seem possible, as over time the Fed is likely have gone too far and fast with rate hikes (probable recession ). They will need to once
again stimulate the economy and unwind rates and reintroduce QE.
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