If you zoom out on this chart you will notice that the market has rallied out of a bat pattern and returned to previous structure. You will also notice i have highlighted a potential reversal zone in blue, and from which we can assume that the market, as usual, will respect structure, and return to structure lows. Here i have two patterns suggesting a reversal in the market.
The first is a head and shoulders, as marked in green. This pattern suggests a short term move to the low side. I believe that if the market breaks the structure low of the right shoulder, that the market will rally down into structure around the 1.2660's. I have placed stops at the top of the head, the entry below the right shoulder and the limit at previous structure around 1.2663
The second pattern is a three drives, this pattern also suggests that the market is becoming weak and is likely to return lower, the drives are most visible in a daily chart, or also if you zoom out. I don't believe there is a safe trade to be made off of this pattern, but I do believe that it reinforces our original speculation that the market will begin a downtrend.
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Thanks and Good Trading!
The first is a head and shoulders, as marked in green. This pattern suggests a short term move to the low side. I believe that if the market breaks the structure low of the right shoulder, that the market will rally down into structure around the 1.2660's. I have placed stops at the top of the head, the entry below the right shoulder and the limit at previous structure around 1.2663
The second pattern is a three drives, this pattern also suggests that the market is becoming weak and is likely to return lower, the drives are most visible in a daily chart, or also if you zoom out. I don't believe there is a safe trade to be made off of this pattern, but I do believe that it reinforces our original speculation that the market will begin a downtrend.
Thanks for viewing, don't be afraid to comment , or like if you agree. and also follow me if you like what you see.
Thanks and Good Trading!