When analyzing this chart, I discovered that price appears to be moving in patterns. Price has an impulse leg, and then has a corrective leg, and then has a new impulse leg that measures the same size as the previous one.
When analyzing the chart, I started by measuring the first impulse, I discovered that the price correction seemed to hit a , there was a new impulse leg. Price has recently been impulsive and has been showing signs of more uptrend. Sure enough, when I measured the second impulse leg, it was the exact same measurement as the first impulse.
I am expecting an up move up to the Cycle #3 completion, which exactly coincides with a historical high to the EXACT pip! Coincidence?
Do remember that before price completes Cycle #3 it will likely correct, so it's important you watch this trade carefully before considering a position.
I will be posting updates on this trade below, so leave it a like & follow so that you can keep up to date with this analysis.
Now that price is nearing Cycle #3 completion, we need to review our analysis and see what to do next.
Upon reviewing this trade on a smaller time frame, I discovered that there is a correction forming.
Remember- that after each cycle has confirmed so far, there has been corrections on smaller time frame first. So, if this trade is to be legitimate, we want to see a buy opportunity after a pullback and expect Cycle #3 to complete.
Any breakdown below the support implies there is weakness in the trend, and could signal a reversal which would discontinue anymore cycles forming. (See chart for details)
If price bounces on the sideways support and rallies, this will confirm that we are trading in the right direction, and opens the possibility to a Cycle #3 forming, which would give us a price target of 10.0800.
We would ideally like to see a relatively steep correction (To the horizontal support line) before Cycle #3 completes. This is because if price bounces off this level, it confirms the uptrend integrity was tested, and proven to be still intact. A correction too shallow might give a false up move first creating a bull trap, before the big move actually takes place.
On the FX open next week, I am expecting a continuation move into the support zone and from there I will be seeking a long opportunity on the 4H chart.