This week on the XAUUSD pair after the long term uptrend, prices have gone into a consolidation within a descending channel. The minor trend is a downtrend, guided by the chart pattern. However we must keep in mind that the main trend is still bullish. Indecision candles closed off the week giving us signs of uncertainty, more so the formation of the long legged doji near the upper boundary of the channel.
A bearish confirmation of the doji will give us a bearish bias. If not, further price action will guide us on the best course of action. For instance, a price breakout above the channel would mean that the upward trend may continue.
On the EURCAD pair, we have a descending wedge in a downtrend is usually a potential reversal signal. As usual, we have to wait for confirmation, before pulling the trigger. Price broke out of the wedge. The next candlestick after the wedge made a small pullback indicated by the lower shadow, also clearly seen on a lower timeframe. Furthermore the pullback candlestick doubles as an inside bar, a potential continuation signal.
Patience is needed to confirm whether bulls will come in strongly after the breakout and take price higher potentially to the near term resistance level.
Disclaimer: This analysis is for educational and general information only and not advice or a recommendation to trade or invest. Do your own research/analysis and don’t blindly enter trades based on the analysis.