AUDUSD Double Bottom Still In Play?

The daily chart of AUDUSD reveals a double bottom with the currency pair bottoming out around 0.6690. Typically, a double bottom chart pattern is interpreted as a bullish indicator. However, the currency pair will need break resistance at the neckline around 0.6930. The level also coincides with a long-term falling trend line. Will Aussie bulls finally be able to break it this week?

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Zooming into the shorter term timeframes, the hourly chart reveals what looks like a bearish flag. AUDUSD saw a drastic decline in Friday’s trading followed by consolidation early in today’s Asian session. A bearish flag is often seen as a continuation pattern which means that we could see the AUDUSD continue its short-term decline.The 4-hour chart reveals that the currency pair may find support at the rising trend line from connecting its lows for October 2 and October 16. If there are enough bulls in the market this week, we could see AUDUSD bounce off the trend line and finally break through resistance on the falling trend line from connecting highs from December 4, April 16, and July 18. A strong close above 0.6930 could mean that the currency pair is on its way to test its July 2019 highs around 0.7070. On the other hand, if the US dollar continues to dominate this week’s trading and resistance holds, AUDUSD could head back down to its yearly lows below 0.6700.Download our latest quarterly market outlook for our longer-term trade ideas.

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