{"id":12150,"date":"2010-08-18T09:22:12","date_gmt":"2010-08-18T13:22:12","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=12150"},"modified":"2010-08-18T09:22:12","modified_gmt":"2010-08-18T13:22:12","slug":"forex-news-audjpy-in-pennant-formation-bearish-move-ahead","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/08\/18\/forex-news-audjpy-in-pennant-formation-bearish-move-ahead\/","title":{"rendered":"Forex News: AUD\/JPY in Pennant Formation; Bearish Move Ahead?"},"content":{"rendered":"

By Greg Holden<\/strong> – The ascendant Japanese yen has continued to pull the AUD\/JPY<\/a> pair higher, but we are beginning to see a long-term bearish formation building. Following the sharp drop from early May, the pair has continued to fluctuate within a steadily climbing, and consolidating range; known as a Pennant<\/a>.<\/p>\n

A Pennant formation occurs when a sharp movement is followed by a steady flattening out, in which the price of the pair tests ever-narrowing highs and lows. Connecting these highs and lows allows us to see a triangle attached to a long \u201cflag pole\u201d (see below).<\/p>\n

Typically when a Pennant formation has finished consolidating at the tip \u2013 in the case of the AUD\/JPY this would be near the 78.00 price mark \u2013 the previous direction, established by the flag pole, will continue.<\/p>\n

Technical Analysis<\/strong><\/p>\n

– The chart below is the AUD\/JPY daily chart provided by ForexYard<\/a>.<\/p>\n

– Point 1<\/strong>: Here we can see our Pennant triangle drawn. The sharp downward movement you see occurring before this triangle is our flag pole.<\/p>\n

– Point 2<\/strong>: At the tip of the Pennant \u2013 the consolidation point \u2013 you can see the price target of 77.98. Not surprisingly, this also corresponds with a solid Fibonacci resistance line (at 38.2%).<\/p>\n

– Point 3<\/strong>: The Relative Strength Index (RSI) currently floats in neutral territory but, in support of the expected consolidation point being reached, the indicator points upwards. We should expect to see this indicator enter the over-bought territory prior to its continuation of the downtrend.<\/p>\n

– Point 4<\/strong>: The Stochastic (slow) shows us the same thing as the RSI, listed above. We should also expect to see a bearish cross just before this pair comes tumbling down.<\/p>\n

– The expectation here is for a steady boost in value towards 78.00, but the technicals appear to imply that the pair will likely fail to breach this line, and wide sell-offs should complete the Pennant\u2019s forecasted downward movements.<\/p>\n

– On the upside, if the pair happens to break through the 78.00 price mark, an expected climb above 80.00 is to be expected.<\/p>\n

– On the downside, the resistance, and possible sell-wave which will follow the downturn, could end up pushing this pair back towards 76.00 over the next few days.<\/p>\n

AUD\/JPY Daily Chart<\/strong><\/p>\n

\"\"<\/a><\/p>\n

Forex <\/strong>Market Analysis provided by ForexYard.<\/a><\/strong><\/em><\/p>\n

\u00a9 2006 by FxYard Ltd<\/p>\n

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Greg Holden – The ascendant Japanese yen has continued to pull the AUD\/JPY pair higher, but we are beginning to see a long-term bearish formation building. Following the sharp drop from early May, the pair has continued to fluctuate within a steadily climbing, and consolidating range; known as a Pennant. A Pennant formation occurs … <\/p>\n

Continue reading “Forex News: AUD\/JPY in Pennant Formation; Bearish Move Ahead?”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-12150","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/12150","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=12150"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/12150\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=12150"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=12150"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=12150"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}