The Australian versus the US dollar currency pair seems to be escaping the bearish force that rests between the 0.7300 and 0.7400 areas. Did the bears really give up?
After the 0.6386 level was validated as support, the price continued the movement toward the north. After two consolidation phases, the quotation achieved etching the 0.7413 high.
However, after reaching it, the bears started pressuring the bulls with enough determination for the price to be sent back to the 0.7010 level.
Upon reaching 0.7010, the bulls resumed their efforts, but the level of 0.7191 was also defended by the bears.
This caused a relatively uneven range trading phase. Still, after the 0.6991 low was crafted on the chart as a false piercing of the 0.7010 level, the bulls managed to thrust and clear the 0.7191 level.
But the bears were not ready to give up that easy, keeping the price under 0.7320 in the hope that the bulls will cede. Nevertheless, for the time being, the bears seem to be those who stepped back, as the bulls won 0.7320.
As a result, two main scenarios are possible. The first one is for the simple continuation of the rise. It could come about more calmly — more less volatile candles — or in a more abrupt configuration — with fewer but quite volatile candles.
In the second scenario, the price returns to 0.7320 to confirm it as support. So, if one of these two scenarios does materialize, then 0.7587 is the next target, with 0.7500 — not highlighted on the chart — as an intermediary profit booking area.
Yet, as an extension of the second scenario, if the bulls fail to validate 0.7320 as support, then the bears could send the price back to 0.7191.
The rise from the 0.6991 low gave birth to a consolidation phase that took the shape of a bullish triangle, with the base marked by the 0.7339 high and the 0.7221 low, the lower boundary by the series of higher lows, and the upper limit by the 0.7341 intermediate level.
As the resistance of the triangle was the one to give way, the bulls are now able to extend their gains. They already did so by reaching the 0.7398 level. If they do keep up the momentum and conquer 0.7398, then 0.7460 is their next target.
Only if the price fails to go above 0.7398, then the bears could send it to 0.7341 and then to 0.7294.
Levels to keep an eye on:
D1: 0.7320 0.7587 0.7500 0.7191
H4: 0.7398 0.7460 0.7341 0.7294
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