AUDJPY is extending the Pitchfork downtrend channel extension
In this article, we are drawing Pitchfork channels on AUDJPY
On the monthly AUDJPY chart, we can see that the instrument is in the downtrend channel and could extend into the 70 level. Now only a daily close above the 80 level could invalidate the downside extension.
Using Andrews Pitchfork tool hint: to plot Andrew’s Pitchfork on a chart, first, look for three consecutive big highs or lows at the asset’s price. These key points are highlighted in the chart below.
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We have used the combination of the top-down trading analysis and the Andrews Pitchfork channels to get to a trading entry stop loss levels and targets indicated below.
On the Weekly chart, the pair formed a downtrend Pitchfork channel and we have a test of the important 77.700 level after the rejection and reversal from the 84 level. By a trading perspective, look for the short trade entries with the stop loss above the 79 level targeting 76 level first, and in a case of a daily close above this level look for the extreme extension higher into the 72 level. Downside invalidation will come on a stop loss trigger and a daily close above the 79 level.
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