AUD/USD: Analysing a Wedge Within a Wedge

25 de jun.

Multi-timeframe analysis is a powerful technique that provides context and clarity to price action analysis. Today, we examine the AUD/USD, which is forming a wedge pattern across two timeframes.

Daily Chart Insights

The AUD/USD daily chart reveals a month-long equilibrium. Following a rally from April lows, AUD/USD encountered resistance at the March highs, leading to a choppy sideways range. This range is forming a wedge pattern, with prices funnelled between lower swing highs and VWAP support anchored to the April lows.

AUD/USD Daily Candle Chart

Past performance is not a reliable indicator of future results

Weekly Chart Context

The weekly chart adds depth to our analysis. It shows a multi-year downtrend with the market funnelled between lower swing highs and higher swing lows, forming a larger wedge pattern.

AUD/USD Weekly Candle Chart

Past performance is not a reliable indicator of future results

Integrating Patterns for a Comprehensive View

By overlaying the daily and weekly charts, we see that the daily wedge pattern is forming near the top of the weekly wedge. This creates a ‘sell zone’ that combines price patterns across multiple timeframes. Swing traders could look for bearish reversal patterns, such as double tops, pin-bars, and engulfing candles, at this sell zone. This multi-timeframe approach enhances the precision of swing trading strategies.

AUD/USD Daily Candle Chart

Past performance is not a reliable indicator of future results

Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80.84% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.