The AUDJPY is in a range and easily tradeable by selling from resistance and buying from support.

We will be selling at the resistance right now. Until this range is broken out on either of the sides, there is no solid trade with other technical factors being aligned. Lately, the range has broken out on the bullish side but seemingly its a stop hunt for a corrective leg downwards. Thats why, we will be looking towards the bearish side for now. 

The market is forming a bearish pennant pattern which has a probability for the slide down. The support trendline is below the current price action and is on the verge of being broken out for sells. Once its broken and candle validation is completed, we will tend to see the further correction towards the bearish side.

There is no current retracement element attached to this short setup.

Both the EMA's are bullish right now and have a bullish death cross. We will only be targeting the EMA 50 as our potential target for the short setup. 

RSI is at 80 and CCI is at 230. Both the oscillators are in an over bought region, with a bearish divergence being formed. This divergence is a three tier divergence which has threee pivot points to drop the market. 

Three tier bearish divergence

Apr 21 2022

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