On the lookout for Aussie trades now that China printed a downbeat inflation report?

Try this neat reversal formation on AUD/CAD!

The pair is simply closing in on its neckline assist, so that you would possibly nonetheless be capable of catch the double high breakdown.

AUD/CAD 1-hour Foreign exchange Chart by TV

Market gamers appear to be beginning the week on a risk-off notice since China simply launched weaker than anticipated CPI and PPI figures earlier right now.

As an alternative of posting the estimated 0.2% year-over-year acquire, headline CPI stayed flat in June. Producer costs additionally got here up brief and posted a steeper 5.4% drop in comparison with the sooner 4.6% slide.

Aussie bears had been fast to react to the report, triggering a selloff throughout the board.

AUD/CAD appears to have room to slip, because the pair simply appears to be gearing up for a break under its double high neckline, which occurs to line up with S1 (.8830) and the 200 SMA dynamic assist.

In that case, value might fall by no less than the identical peak because the chart sample, which spans roughly 70 pips. This is likely to be sufficient to take it right down to S2 (.8760) or decrease.

In the meantime, the Loonie might take pleasure in some assist main as much as the BOC resolution, because the central financial institution continues to be extensively anticipated to hike charges by one other 0.25%.

Simply watch out since technical indicators just like the shifting averages and Stochastic are hinting at a attainable return in bullish stress.

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