Chart of the Week #1


This put up marks the beginning of a brand new weekly class right here on the Tradeciety.com web site. From this week on, I shall be sharing the chart of the week each Friday right here on our weblog. With the chart of the week, we’re going to take a deep dive into chart analyses, and worth motion buying and selling, utilizing a step-by-step method to understanding worth charts. 

This week, we’re going to check out the AUD/USD. I shared this chart research in my weekly e-newsletter beforehand. If you wish to be a part of my weekly buying and selling e-newsletter and obtain one e-mail each Thursday with model new buying and selling suggestions and one of the best chart research, you possibly can subscribe free of charge right here: Tradeciety Publication

 

Let´s begin on the larger timeframe and we are able to discover lots of nice insights in regards to the worth motion right here:

  • The Double Prime marks the excessive level of the vary. When the worth fails to clear a excessive, the sentiment turns barely bearish. However there may be extra…
  • Subsequent is the Liquidity Seize. A Liquidity Seize is a fakeout sample. This sample reveals the rejection of the bullish try to take out the highs. One other bearish sign.
  • Then there may be the Break of Construction which alerts that the worth is now in a position to break into recent lows. At this level, it’s time to go to the decrease timeframe. 

AUDUSD_2023-08-03_09-29-38

 

On the decrease timeframe, we are able to see the breakout development wave. Nevertheless, one factor is essential to look at right here: Though there’s a breakout, the pre-breakout development wave is extraordinarily bearish. The merchants who resolve to simply promote the breakout at this level are chasing the worth. That is typically thought-about dangerous apply. The longer a pre-breakout development wave is occurring, the upper the possibility of a pullback. So one of the best factor right here is to attend for the subsequent sign… 

AUDUSD_2023-08-03_09-30-31

 

Ready was actually the correct choice. Though, on this instance, the breakout may have offered a small winner, this isn’t all the time the case and a pullback may also happen a lot sooner. Now, the worth has arrived again on the breakout degree and we are able to anticipate help to show into resistance. To get a fair higher entry sign probably, we are able to go to a fair decrease timeframe to look at the worth motion there.

AUDUSD_2023-08-03_09-31-06

 

The decrease timeframe reveals this wonderful Momentum Buildup sample. The value has constructed a pure help degree and is basically sticking to the extent. This reveals that there’s a lot of promoting curiosity that’s maintaining the worth that near the extent; the patrons can’t get the worth larger from there anymore. A breakout may sign the beginning of the subsequent development wave. That approach, the dealer wouldn’t chase the worth however enter comparatively early within the new development wave; a significantly better entry situation in comparison with the primary one above.

AUDUSD_2023-08-03_09-32-40

 

And voila. The ultimate end result. In fact, this is not going to work out on a regular basis however nothing in buying and selling works 100%. Nevertheless, this top-down method generally is a nice basis for a buying and selling technique. I’d suggest making an attempt it on Demo or in a Backtest (no actual cash!) and evaluating the effectiveness for your self.

AUDUSD_2023-08-03_09-33-05

 

That´s it for this week´s chart of the week. You’ll learn once more from me subsequent week with some new buying and selling suggestions and my favourite charts.

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