The Pattern Pulse – 6 February 2025

Forex: Potential Diamond Bottom Pattern on AUD/USD

Daily Timeframe:

Following a 12% plunge since topping out at US$0.6942 at the beginning of October 2024 – with pullbacks few and far between – the AUD/USD (Australian dollar versus the US dollar) is pencilling in what appears to be a diamond bottom pattern around US$0.6150ish (made up of a broadening formation and a possible symmetrical triangle).

What’s technically interesting from the daily chart is that the diamond bottom is forming from monthly support coming in at US$0.6094. Following at least two tests of the symmetrical triangle outer edges on each side, should this pattern complete – price breakout to the upside – strong moves higher could be prompted once established.

Commodities: Gold Flying High!

Monthly Timeframe:

Spot gold (XAU/USD) is on track to record a sixth consecutive weekly gain. The precious metal has chalked up record highs each day in the first half of this week.

From the monthly timeframe, you will note that price is fast approaching possible resistance in the form of a 1.272% Fibonacci projection ratio at US$2,933. Interestingly, alongside this resistance, the Relative Strength Index (RSI) has tested resistance between 87.31 and 82.20, an area that has been in play since 2006. Were a price correction to unfold in this market, the decision point area calls for attention at US$2,428-US$2,290.

Equities: Simple Technicals Suggest the Dow 30 Wants to Refresh All-Time Highs

Weekly Timeframe:

Price action on the Dow Jones Industrial Average (DOW 30) demonstrates that buyers will likely take things to fresh all-time highs soon. Not only did support from 42,031 stand firm in mid-January (and establish a bullish engulfing candle), but the move was bolstered by the RSI also rebounding from the 50.00 centreline (positive momentum).

You may also note that last week’s test of current record highs of 45,073 failed to trigger much follow-through to the downside. This highlights potential bullish intent at current levels.

Cryptocurrency: BTC/USD Still Rangebound

Daily Timeframe:

Last week, I touched on BTC/USD (Bitcoin versus the US dollar), noting that despite the major Crypto pair consolidating between support of US$91,591 and US$108,396, price was gearing up to breakout higher following US$100,000 delivering support.

As you can see from the chart below, a breakout higher failed to materialise and price elbowed back under US$100,000 and the 50-day simple moving average at US$98,995. Despite this, the consolidation is still active. We recently rebounded higher from its lower edge; therefore, I feel BTC/USD will remain on the offensive for the foreseeable future and eventually breakout beyond the current consolidation and refresh all-time highs. This setup, of course, will be emphasised should price push back above US$100,000.

Written by FP Markets Market Analyst Aaron Hill