Looking for simple chart patterns to trade?
I’ve got a couple of these for you on the 4-hour charts of AUD/CHF and EUR/NZD.
Better keep tabs on these inflection points:
EUR/NZD: 4-hour
This pair has formed lower highs and found support around the 1.5740 level, creating a descending triangle pattern on its 4-hour time frame.
Price is closing in on the triangle support and could be due for another bounce soon, but technical indicators are suggesting otherwise.
Stochastic has some room to slide, so EUR/NZD could follow suit while bearish pressure is in play. At the same time, the 100 SMA is below the 200 SMA to confirm that support is more likely to break than to hold.
If a breakdown occurs, the pair could tumble by the same height as the triangle formation, which spans around 700 pips.
Just stay on the lookout for Stochastic pulling higher from the oversold region because this would signal that buyers are ready to return.
AUD/CHF: 4-hour
AUD/CHF 4-hour Forex ChartAUD/CHF 4-hour Forex Chart
Reversal alert!
AUD/CHF fell through its ascending trend line support that’s been holding since last month, indicating that a reversal from the climb is in the works.
In addition, the pair is forming a double top pattern with the neckline around the .6900 handle. Another break below this area could set off a drop that’s the same height as the formation, which is around 200 pips tall.
However, Stochastic is still on the move up to show that buyers have the upper hand. This could allow AUD/CHF to retest the broken trend line which coincides with the 50% Fib.
Also, note that the 100 SMA is above the 200 SMA to suggest that bullish momentum is present. Then again, the pair has fallen below the 100 SMA dynamic inflection point, so this could hold as resistance moving forward.
