AUDUSD getting smashed here with a return to the dominant trend in tandem with bearish stock indexes.
Not posted on AUD for a little while but here is some of my work so far.
I shorted both these highlighted long wicked stars.
For the first star I had an alarmed stop above the top and entered at the close looking for a good long term position for reversal and resusmption of the dominant trend to the downside.
For the first star I exited my position for a small loss but that was fine because by the time the next star printed the trend was over extended and provided an excellent entry again - entering at the close, alarmed stop above the top.
There were plenty of other factors that added confluence to make this an entry with confidence:
The star peaked within the common inverted phi 0.618 fakeout reversal zone which in FX tends to stretch up to 0.7 On this occasion it topped at 0.682
The 3 wave from the lows projected an equidistant 1:1 projection of which the star formed a fakeout reversal through with upper wick piercing.
The last wave up pierced through "distribution resistance" and also the 2 trendlines - so there were a multutude of fakeouts here all adding confluence for a sharp reversal.
Hidden RSI divergence between the 2 peaks showing momentum decline.
This entire bottom is most likely a higher time frame domed retracement from the top that should at the very least see a 1:1 equidistant extension down to 0.66664.
Not advice.
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Closed position at 1:1 which has formed a wicked shakeout reversal. 4H RSI hit 18 and so good chance a bounce is coming.
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Bearish breakdown pattern at the 0.236 is very weak and should mean another (hopefully devastating) leg down is coming. I have re-entered short with stop above the top.