The AUDJPY has formed a hidden bullish divergence at key cluster support area. Bullish divergence happens when price makes a lower low while the oscillator makes a higher low, indicating decaying sustained bearish momentum over time.
With bearish price action over-extended beyond W H5 pivot, a bullish move is likely to transpire.
Looking at charts, there are 2 POC zones bullish rejection may occur. POC 1, 78.08-18 is the first area of strong confluence [L3 ATR pivot // D L3 // 0/8 MM Octave] and POC 2, 77.87-97 [L2 ATR pivot // D L4 // -1/8 MM Octave].
Target is 78.80, [D L5, 4/8 Octave], bringing price within the weekly range once more. Friday profit taking during the end of NY session might be a catalyst for the above scenario. Last frontier where price takes a last ditch attempt to bounce is in D L5, -2/8 MM Octave confluence zone, 77.64-74.
Look for a reversal candle pattern (Inverted Hammer, Marubozu close, Engulfing, Three Inside Up) as a confirmation to pull the trigger.
The analysis has been done with the CAMMACD.MTF template.
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