By: Dima Chernovolov
EUR/AUD recently reversed up from the bottom of the 4-hour Down Channel chart pattern which was earlier identified by Autochartist. Autochartist rates the quality of this Down Channel at the 7-bar level – which is the result of the sharp Initial Trend (10 bars), below-average Uniformity (4 bars) and strong Clarity (8 bars). EUR/AUD is expected to rise further inside Down Channel – in line with the earlier upward reversal from the key support area shown below.
As can be seen from the daily EUR/AUD chart below, the price earlier reversed up from the key support area lying between the powerful support level 1.6050 (former strong support from May), 50% Fibonacci correction of the sharp upward impulse from April and the lower daily Bollinger Band. The proximity of this support area and the oversold daily Stochastic add to the probability EUR/AUD will continue to rise inside this Down Channel.