Currency Pairs AUD/USD
Risk-Reward 1:2.8
Reasons for Entry
Looking at the 4-hour chart, the left-hand wave pattern had completed Elliott Wave 5, and at exactly that moment, a double bottom formed relative to the neckline on the daily chart. So, I waited for the price to break above the green line — the neckline of the double bottom — and then waited for a pullback toward the neckline before entering a long position when the price began rising again. Normally, with a double bottom, one should place a stop-loss slightly below the second low; however, since the risk-reward ratio was unfavorable, I placed it slightly below the candle that formed a long lower wick after analyzing the price action.
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