The AUDUSD currency pair has been forming a head and shoulders pattern since early August, with the following breakout below the neckline. This is clearly visible on the hourly timeframe. After such a pattern concludes, the price often retraces to retest the breached support level—in this case, 0.6480. Meanwhile, the AUDUSD pair has the potential to drop further toward another support at 0.6417. Then quotes could bounce off this threshold, targeting 0.6480 again. Therefore, opening a sell position near the 0.6480 level is recommended for an improved risk-reward ratio.
Looking at higher timeframes (H4, D1), the broader downtrend suggests a move toward 0.6390 and 0.6370 is probable. Another bearish pattern is likely to form within this range, with several strong candlesticks indicating sellers’ dominance. However, the chances of AUDUSD retesting the 0.6480 level on lower timeframes are rather high.
The overall recommendation is to buy AUDUSD. Profits should be taken at the level of 0.6480. A Stop Loss order could be placed at 0.6405.
The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening such a position, it is better to avoid entering the market on this signal and wait for other low-risk trade opportunities.
This content is for informational purposes only and is not intended to be investing advice.
