AUDUSD - Shark Harmonic Pattern Formation Detected-Bearish Trend
AUDUSD is currently forming a Shark Harmonic Pattern (XABCD) on the 4-hour time frame. This pattern is characterized by specific Fibonacci ratios between the price swings. The completion point, Point D, coincides with a key Resistance level, indicating a potential reversal.
Trendline Analysis:
In addition to the harmonic pattern, there is a significant Trendline acting as a dynamic resistance level, further supporting the bearish outlook.
Entry and Stop Loss:
Based on the analysis, a prudent entry point is identified at 0.64800, just below Point D. To manage risk, a stop loss is recommended at 0.65350, above the recent swing high and the pattern completion point.
Take Profit Targets:
Three take profit targets are set to capitalize on potential downward movement:
Risk Management:
The risk-to-reward ratio for this trade is carefully considered to ensure favorable risk management. The potential profit targets offer a balanced reward relative to the risk taken with the stop loss.
Conclusion:
With the Shark Harmonic Pattern formation, along with the confluence of the Trendline and key Resistance level, the technical analysis suggests a bearish momentum in AUDUSD. Traders may consider entering short positions with the specified entry, stop loss, and take profit levels, keeping risk management principles in mind.
Trendline Analysis:
In addition to the harmonic pattern, there is a significant Trendline acting as a dynamic resistance level, further supporting the bearish outlook.
Entry and Stop Loss:
Based on the analysis, a prudent entry point is identified at 0.64800, just below Point D. To manage risk, a stop loss is recommended at 0.65350, above the recent swing high and the pattern completion point.
Take Profit Targets:
Three take profit targets are set to capitalize on potential downward movement:
- TP-1: 0.64270
- TP-2: 0.63740
- TP-3: 0.63200
Risk Management:
The risk-to-reward ratio for this trade is carefully considered to ensure favorable risk management. The potential profit targets offer a balanced reward relative to the risk taken with the stop loss.
Conclusion:
With the Shark Harmonic Pattern formation, along with the confluence of the Trendline and key Resistance level, the technical analysis suggests a bearish momentum in AUDUSD. Traders may consider entering short positions with the specified entry, stop loss, and take profit levels, keeping risk management principles in mind.