today i want to share this top down analysis on AUDUSD . As you know, i start my trading analysis on higher timeframe (to get a bigger perspective), and then i enter the market in lower timeframe.
On the we recently exited a OVERBOUGHT condition on , that's indicative of an overextended market, near to a completion.
So the bigger picture tells me this may be the starting point of a reversal; therefore i go on lower timeframe (4h) and i see a (with divergence) with a break of structure to the downside, and that's another clue in the direction i've chosen on the daily. I could have used 2618 strategy to sell the market at the but in order to have a closer look, i lowered another timeframe; finally we're here. On the 1h chart, as you can see, i spotted a completing near to the 618 level.
So i've decided to use the Bat completion point as a better entry for a 2618 trade, therefore with stops above the and target1 at the retest of the lows. This way i can have almost a 2:1 RR on the first target and possibly a 4:1 RR on the second target.
Hope you understand the process that brought me to this decision.
If you have any question, feel free to ask beneath,
Otherwise, see you in the next chart!
Wishing you all the best