Analyzing the AUDCHF pair on the 3-hour chart through Elliott Wave theory, we see a compelling opportunity for a short position. The price action has completed what appears to be an impulse sequence up to wave (5), followed by the start of a corrective ABC pattern.
Currently, the price is consolidating around a significant resistance level marked by the peak of wave (5). With the formation of wave (a) and a slight retracement up for wave (b) at 0.59959, which corresponds with the 0.942 Fibonacci retracement level, we are anticipating the commencement of wave (c). This wave is expected to be a sharp decline, potentially targeting the 1.618 Fibonacci extension of wave (a) at 0.58820.
For traders considering a short position, entering near the current retracement level offers an attractive entry point with a stop-loss set above the recent high of wave (b) to manage risk effectively. This trade setup not only aligns with the overall corrective pattern but also offers a favorable risk-reward ratio, anticipating a significant downward movement.
As always, monitor the price action closely and be prepared to adjust your trading strategy in response to new market information. Corrective waves can be volatile and unpredictable, so maintaining strict risk management is crucial.
Currently, the price is consolidating around a significant resistance level marked by the peak of wave (5). With the formation of wave (a) and a slight retracement up for wave (b) at 0.59959, which corresponds with the 0.942 Fibonacci retracement level, we are anticipating the commencement of wave (c). This wave is expected to be a sharp decline, potentially targeting the 1.618 Fibonacci extension of wave (a) at 0.58820.
For traders considering a short position, entering near the current retracement level offers an attractive entry point with a stop-loss set above the recent high of wave (b) to manage risk effectively. This trade setup not only aligns with the overall corrective pattern but also offers a favorable risk-reward ratio, anticipating a significant downward movement.
As always, monitor the price action closely and be prepared to adjust your trading strategy in response to new market information. Corrective waves can be volatile and unpredictable, so maintaining strict risk management is crucial.
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