GBPUSD made a 400 Pips move to the downside (Wave Ⓐ) and has been correcting since then.
This move to the upside could not be labelled impulsive. And we can clearly see an ABC Correction.
In this ABC pattern we have an Zig-Zag for wave (A), an expanded flat for wave (B) and five-wave push to the upside for wave (C).
Wave (C) got right into the resistance zone with five waves and formed a pinbar sell signal at the 61,8% Fibonacci level.
We also have a RSI divergence between wave 3 & 5 on the 1H chart.
→ The combination of:
● corrective structure with impulsive 5-wave finish,
● resistance area,
● fibonacci retracement,
● candlestick pattern and
● RSI divergence
gives us an edge in the market.
This pattern might not play out 100% of the time (no edge will), but it stacks the odds in our favor.
The trade which was entered on the 1H Pinbar signal is already BE, but more downside potential is expected for wave Ⓒ.
This is no investment advice. Just for educational purpose only. Do not risk your own money without testing a strategy on a demo account.
This move to the upside could not be labelled impulsive. And we can clearly see an ABC Correction.
In this ABC pattern we have an Zig-Zag for wave (A), an expanded flat for wave (B) and five-wave push to the upside for wave (C).
Wave (C) got right into the resistance zone with five waves and formed a pinbar sell signal at the 61,8% Fibonacci level.
We also have a RSI divergence between wave 3 & 5 on the 1H chart.
→ The combination of:
● corrective structure with impulsive 5-wave finish,
● resistance area,
● fibonacci retracement,
● candlestick pattern and
● RSI divergence
gives us an edge in the market.
This pattern might not play out 100% of the time (no edge will), but it stacks the odds in our favor.
The trade which was entered on the 1H Pinbar signal is already BE, but more downside potential is expected for wave Ⓒ.
This is no investment advice. Just for educational purpose only. Do not risk your own money without testing a strategy on a demo account.