Short AUDCHF Idea based on Classical chart patterns on a short time frame(4H chart).
abbreviations:
M/W/D/H = Month/Week/Day/Hour
TL: Trendline
DT: Double Top
DTr: Descending Triangle
The chart goes from Monthly(top left)/Weekly(top right)/Daily(bottom left)/4 Hours(bottom right)
1st from the monthly chart you can see the pair in a steady down trend, and maybe one could say that it is sitting at the low ends of the down trend.
zoom into the weekly chart and you see that indeed there was a DTr that took 17W to form indicating a break lower, which never happened. A failure of this pattern led to a move to the target derived from the pattern @0.6055 level. the market now hit the target. And the heat seems to be waning.
in the daily chart, near the 17W DTr failure target the market has now attempted to form patterns indicating topping out of the moves, 8W DT and 4WDT. While the former turned out to be a failed pattern, the former, at least for now, seems like a pattern completion.
all this in mind, the 4H chart now seems to be forming a 1W DB, which could mean that the market is still strong, and the bullish move may continue, or this is a failed attempt to consolidate and the trend turns.
based on the target derived from the 1W DB, the risk return looks more favor for a short AUDCHF, looking for almost 7:1 risk reward trade.
Entry : 0.5938 or above
SL : 0.5953 (-0.25%) / TP: 0.5835(+1.7%)
(as always, not investment advise or prediction)
