AUDCAD consolidates again and poised for explosive sell offI published an idea previously, check it out here:
Unfortunately, my previous idea did not hold up. But that's okay, we take smaller risks for multiple times the return. This is a second attempt to short into this pair.
1. 0.9125 marks a relative high point. You can see a fake out that occurred where price broke above this level and then instantly sold off. What does this mean? There's most likely selling volume above this level.
2. After such a rally, we're seeing that the moving averages are flat lining. This doesn't necessarily mean that the trend is reversing. All it's saying is that the average price climb isn't pushing new highs. As a result, it's largely holding flat. Could price soar up higher over the next day or even next week? Sure, it's definitely possible. I personally think that it's unlikely given how price reacted to the 0.9125 level. Let's not forget the significant rally from the weeks prior. New buying pressure largely seems unlikely.
3. We're also looking at the RSI performance on the daily.
There's a slight divergence here where the RSI is painting lower, which signals that average upticks are not as strong. At the same time, price inches higher.
Note that this is probably a longer term play. It might take a while for this trade to play out as this pair could further consolidate.
