It should be noted that this consolidation is developing in the middle of a downtrend. The moving averages are mostly in bearish alignment. A breakout below 0.7825 can easily put them in order with 200SMA on top going down to 8SMA at the bottom closes to price action.
The RSI mostly remained below 60. After tagging 30 consistently, the inability to push above 60 reflects a persistent bearish momentum.
The bearish momentum and price action is more apparent in the 4H chart, where the moving averages have kept bearish alignment and the RSI reading remains low. This is because the market is not only trading in a declining channel, but hugging the lower half of the channel.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.