Double Top on AUD/NZD @ H4

The double top (M-pattern) is now clearly visible on AUD/NZD chart in H4 timeframe. Like the symmetrical triangles on USD/JPY it was forming since May 16. Not many currency traders look into such pairs as AUD/NZD, but this time it seems to be worth it. The pattern may look to be far from perfect — first top is a bit higher than the second and also consists of “sub-tops“, and the neckline is rather rough. Despite that, it is fully tradeable. A bearish breakout is the most probable outcome here, but if it fails, a rectangle may be formed, which can break out in either direction.
The yellow lines on the image below show the borders of the double top pattern. The cyan lines located at 10% distance out of the borders are my entry points. The green lines located at 100% out of the pattern’s borders show my targets. Stop-loss is to be set at the high or low of the breakout bar or the bar preceding it. Timeout for the position is set to June 7. Please click on the chart below to get a screenshot of the complete chart of this Forex pair:

Update 2012-05-29: Short position entered today at 1.2950 with a stop-loss at 1.2947 (according to the high of the H4 bar of 12:00 GMT) and take-profit of 1.2796.
Update 2012-06-06: Position closed at stop-loss at 1.2947 today. Was in some nice paper profit during Monday-Tuesday, but fundamentals turned too pro-AUD for a short position to work.

If you have any questions or comments regarding this AUD/NZD chart pattern, please feel free to reply via the form below.

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