AUD/USD Potential Reversal and Uptrend Continuation

Observation: The AUD/USD pair is depicted on a 15-minute chart, showing a recent upward trend followed by a consolidation phase. The price is currently at a critical Fibonacci retracement level around 0.63996, which could act as a potential support.

Analysis: The chart features a series of higher lows and higher highs, indicating an intact uptrend. The Fibonacci retracement levels drawn from the recent swing low to swing high show that the price is hovering around the 0.786 retracement level at approximately 0.63959. This level often acts as a strong support in trending markets.

Trading Strategy:

Entry Point: Consider a long position if the price respects the 0.786 Fibonacci level and shows bullish reversal signals such as a pin bar or bullish engulfing candle.

Stop Loss: Place a stop loss below the recent swing low at around 0.63817 to protect against unexpected reversals.

Profit Targets: Aim for initial profits at the recent swing high around 0.64030. Further targets could be set at Fibonacci extension levels of 1.618 (0.64251) and 2.618 (0.64062) if the upward momentum continues.

Risk Management: Adjust position size to maintain a risk profile of no more than 2% of the trading capital. Monitor the trade closely for signs of weakening momentum or reversal patterns near target levels.

This strategy capitalizes on the trend continuation pattern and uses Fibonacci levels for strategic entry and exit points.