The AUDUSD has been one of the big movers this year – a large long term bearish trend is powering down the charts as this market continues to weaken.
During the last few weeks, the downward momentum has taken pause as the market slows down and consolidates a little above a support level.
Last session, an inside day formed after price rallied into the mean value. The mean value is containing the market from pushing into higher prices, and is the optimum area to re-enter this downtrend.
Now we’ve got an Inside day, it’s the perfect framework for building breakout trades off. There is some hot AUD news coming out this session, which may fuel a nice breakout here. We’re only looking for bearish breakouts so we’re in alignment with the overall downtrend.
If a bearish breakout plays out, we will be watching for a break of the support level, and hopefully see a push into fresh new lows. If support breaks, this could be a very high return trade.
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