Greetings, fellow traders! Today, we dive into the Island Reversal patterns, a fascinating subset of price gap structures. Understanding their intricacies can empower us to make informed and strategic trading decisions.
Unraveling Island Reversals:
Island Reversals materialize when prices find themselves marooned amidst gaps, isolated from preceding trends....
The Island Reversal pattern is when increased distributions in overnight activity cause gaps up and eventually volume exhaustion a second gap down forming an island of candles.
The Island Reversal can be Bullish (inverted island) or a Bearish Island and is preceded by lengthy trends with a reversal trend the other way.
No real profit targets for the island...
A: What type of gap is A1?
Possibly a continuation gap or exhaustion gap. This gap is questionable because it is unconfirmed.
A2: This is confirmation that A1 is an exhaustion gap.
This gap is now at least a temporary exhaustion gap. An exhaustion gap breaks out in the direction of the current trend, and then it will reverse direction and break the...
