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Since the 20th of June, the Aussie has been in an upward sloping channel which has been rather orderly making a touch on the top and then venturing to the bottom....until recently. Lately, it has been hanging around the upper band of this channel and putting pressure on the topside (along with the sellers in the market). SEE CHART BELOW.
Generally, when you see this in a range or channel, it means the sellers are being squeezed out of the market as they are unable to make any progress to the downside while the bulls apply continuous pressure on them squeezing them out of the market. This ability for price to remain towards the upper boundary of the channel will no doubt bring other players in who are also noticing this price action. Thus, I am favoring more of a breakout to the upside.
However, I do see a sticky level below which is a failure point for me, meaning should the bulls fail to hold this level, then the bears should be able to make some headway to the downside. This failure point at 1.0533 is a nice role reversal level which was resistance back in the end of July and support on Aug. 7th. Should this level fail to hold the price action up, I would suspect this could be a good place for bears to get in as prices should decline to about 1.0445 which was also a role reversal level and a key support area behind this last leg, so plays for both bulls and bears here.
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