Short-term selling opportunity emerges on the AUDUSD. In overall, in the long-term we have a bullish trend (major lows and highs are higher) here but most recently (since the beginning of September) the price is declining,
In the last few weeks, the price created a head and shoulders formation, which is a bearish reversal pattern. Unfortunately, in this case, the neckline (blue) is declining, which usually complicates the technical signal. Currently, we are having a sideways trend in form of the rectangle (green lines) and the price is aiming towards its lower line. That is where the sell signal can emerge. In case of the breakout of the lower line of this formation, the sell signal will be triggered. The potential target for this movement is the long-term up trendline (purple), which creates a short-term opportunity for around 80 pips.
As for now, thinking about the bigger downswing is a bit extreme as the price is still above the long-term up trendline mentioned above. Our negative scenario will be denied, once the price will break the horizontal resistance on the 0.775 (orange), which was already respected many times in the past few months.
