Today we are looking at AUD on USD. In the left top we are looking at an 4h chart. Right top we see the Average Directional Index. Bottomside we have a week chart.
- 2 Head & Shoulders options to discuss :
1) If we take a look on the 4h chart we can see a inverse H&S that has the outcome to go strongly upwards. I'm guessing that we can reach the level where we started the H&S. Trade: I would go in twice : 1) go in at 0,78699 and take profit on 0,79101. This trade has a reward/risk of 1,48. 2) go in at 0,78700 and take profit on 0,79500. This trade has a reward/risk of 2,94.
2) if we take a look on the 1week chart we can see a normal H&S that has the outcome to go in a downtrend. Trade: Also 2 times: 1) go in at 0,78225 and take profit on 0,77648. This trade has a reward/risk of 2,63. 2) go in at 0,78254 and take profit on 0,76470. This trade has a reward/risk of 9,62.
Looking at the right top screen we see the ADX that can touch the support line and go up again to a strong uptrend. Just to be sure, I would wait a couple of hours to choose between option 1 or 2. If I had to choose immediately, I'm putting my money on option number 1 but hoping on option 2 to have more profit...
I'm hoping that you guys can take some profits out of it . Let me know what you guys think !