AUD/JPY 1H Chart: Channel Up

GBP/NZD 1H Chart: Channel Down

Comment: Over the last three weeks GBP/NZD has formed a bearish channel. However, the prospects for the time being are uncertain, as the currency pair is approaching important support. July low at 2.27 may well turn out to be a floor for the Pound and trigger a long-term recovery. This will be confirmed by a breach of the upper boundary of the pattern at 2.3040, which will pave the way for a rally towards the 200-hour SMA at 2.3360. On the other hand, if 2.27 is broken, the next target could be as low as 2.1330, where the pair bottomed out in June. Proximity to an important level could be a reason for a significant skew in the distribution between the bulls and bears: 65% of positions are long and 35% are short.

AUD/JPY 1H Chart: Channel Up

Comment: AUD/JPY appears to be forming a bullish channel in the hourly chart. However, unlike the upper boundary of the pattern the lower line is weak so far, and an additional confirmation of the trend-line is required to establish a bullish outlook. Still, the technical indicators are mostly pointing upwards, which increases the chance of 87.50 withstanding the bearish pressure. If this is not the case and the price dips lower, the Aussie will likely extend the decline down to a dense demand area circa 85.80, where the Oct 8 merges with the weekly S1 and 200-hour SMA. In the meantime, two thirds of the SWFX market participants are long the Australian Dollar against the Yen.

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