Fibonacci Retracement in Confluence with a Major Liquidity Zone
The Sterling Dollar pair is at its lowest since November 2019. It's been surging since 3rd of February and is currently doing a pullback.
The price is approaching a minor resistance zone with confluence with the Fibonacci 38.2% retracement level. It's been bouncing off this
level for a week now.
If the price goes past the 38.2% retracement level, we will need to pay attention to the 50% retracement level with confluence to our
liquidity zone. The 50% level has been a major support zone in November 2019 as well as 10th and 21st of February 2020. We need to
see rejection on this zone (bearish engulfing, shooting star, etc.) before considering this a setup.
If the price gets rejected on the 50% level, we can short the pair and trail our stop to the 38.2% level, down to the 23.6% retracement level.
That would give us a favorable 1:3.5 RR Ratio.
The price is approaching a minor resistance zone with confluence with the Fibonacci 38.2% retracement level. It's been bouncing off this
level for a week now.
If the price goes past the 38.2% retracement level, we will need to pay attention to the 50% retracement level with confluence to our
liquidity zone. The 50% level has been a major support zone in November 2019 as well as 10th and 21st of February 2020. We need to
see rejection on this zone (bearish engulfing, shooting star, etc.) before considering this a setup.
If the price gets rejected on the 50% level, we can short the pair and trail our stop to the 38.2% level, down to the 23.6% retracement level.
That would give us a favorable 1:3.5 RR Ratio.