Hello dear traders and friends. Let's take a look at the AUDJPY chart and explore the potential bullish move that could happen from around here.
As observed in the 4-hour timeframe chart, the overall direction of the price is bullish, characterized by higher highs (HH) and higher lows (HL). The price respects a bullish trendline acting as support, with clear bullish bounces occurring each time the price reaches or gets close to this line.
Simultaneously, in the 1-hour timeframe chart, the price is forming a double bottom, corresponding with a bullish divergence between price and the momentum (Stoch) oscillator. The crucial aspect of these two confluences is that they are occurring in an important supportive area, namely the static support area and the bullish trendline, which adds to the possibility of the divergence working out.
From a candlestick perspective, we also observe the formation of a bullish engulfing candle in the 1-hour timeframe, which can be interpreted as a morning star if combined with two previous candles.
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As observed in the 4-hour timeframe chart, the overall direction of the price is bullish, characterized by higher highs (HH) and higher lows (HL). The price respects a bullish trendline acting as support, with clear bullish bounces occurring each time the price reaches or gets close to this line.
Simultaneously, in the 1-hour timeframe chart, the price is forming a double bottom, corresponding with a bullish divergence between price and the momentum (Stoch) oscillator. The crucial aspect of these two confluences is that they are occurring in an important supportive area, namely the static support area and the bullish trendline, which adds to the possibility of the divergence working out.
From a candlestick perspective, we also observe the formation of a bullish engulfing candle in the 1-hour timeframe, which can be interpreted as a morning star if combined with two previous candles.
If you've found this analysis helpful, please take a moment to like, comment, or share your thoughts with me.
The bearish move in price forced us to experience drawdown, but eventually, the price seems to have formed a low and has been trading upwards since then. The price has now successfully shifted the lower timeframe structure to bullish, in line with the higher timeframe structure.
The upside breakout of the short-term bearish trendline triggered the last signal for a further upside move.