GBP/AUD is for H&S Lovers
One to watch this week (and perhaps next) for H&S lovers is GBP/AUD. The tentative pattern is actually quite compelling for many reasons.
First of all GBP/AUD is on a multi-months bullish run which stalled just shy of a major monthly Fib retracement near 1.92.
Also, the pattern itself so far abides by market geometry quite accurately. For instance, left and right shoulders could top at the same 1.8650 level, which is the mid-point between the head and the right neckline, and have the same slope.
Regardless of the completion of the entire H&S pattern, a short above 1.85 with a protective stop above 1.866 does seem a reasonable short-term approach at the moment. Then, if 1.84 breaks it would be surprising not to see at least a test of the neckline.
First of all GBP/AUD is on a multi-months bullish run which stalled just shy of a major monthly Fib retracement near 1.92.
Also, the pattern itself so far abides by market geometry quite accurately. For instance, left and right shoulders could top at the same 1.8650 level, which is the mid-point between the head and the right neckline, and have the same slope.
Regardless of the completion of the entire H&S pattern, a short above 1.85 with a protective stop above 1.866 does seem a reasonable short-term approach at the moment. Then, if 1.84 breaks it would be surprising not to see at least a test of the neckline.
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