QUICK ANALYSIS: AUDUSD: Waiting wave (B) To Finish. Then What?

FX:AUDUSD   Australian Dollar/U.S. Dollar
So after hitting for +374 pips on the last trade I made on this pair, the question now becomes: What next? So here I am showing what I am seeing as the next possible move which would be a wave (C) up to complete the wave (4). Then we should see a significant wave (5) down.

I'm thinking that the wave (B) should end just around he 70 cents level where there is a AB=CD pattern in the wave (B) at 0.70038. I remember there was a guy who doubted me when I said that this pair would retest the 69-70 cents level and asked me why I was so sure it would do so? Well, I sincerely hope he didn't lose too much money doubting me!

Anyway, what I am seeing is that this wave (4) is going to unfold in an ABC 5-3-5 Zigzag pattern with wave (A) already unfolded in 5 waves and now wave (B) in 3 waves. That would mean we should expect that wave (C) will be a 5 wave move. So should be looking for wave 1 next.

After hitting on that nice downtrend off the cypher #1 (green), that leaves cypher #2 still intact and valid. After wave (B) ends, that ending will become a C point for a POTENTIAL bearish Gartley . Now here's where some people may disagree or be confused about this Gartley . Gartley's as you may know, have a B point at .618. If you look at the B point of the Gartley on the 4HR chart, you'll see that the B point has CLOSED above the .618 retrace of XA. HUH? Then why is it a Gartley you might ask? If you go to the DAILY CHART as I show below, you will see that the B point DOES NOT close above .618 retrace of XA! Sure, it does have a wick that goes above the .618 but that wick does not reach the next pattern fib level of .786 to be considered a butterfly . This is why for me, this is a valid Gartley . You could also make the case that it should be considered a crab and you would not be wrong. But in this case, I am calling it a Gartley because it fits into my overall wave count whereas a crab would violate my wave count. It's D point would have the ending of wave (4) in the price territory of wave (1) and that would break my wave count.

Another thing to note is that Gartley completes right near the .382 retrace of the entire previous impulse wave down. Confluece.

DAILY CHART - Showing the POTENTIAL Bearish Gartley

I am waiting for the wave (B) to finish. When it does, I will be going LONG on this pair again.

Please keep in mind that I am not giving any trading signals or trade calls here. Only providing my own trade thoughts for your benefit and insight as to my trading technique and style. Please don't ask if you should or should not take the trade or ask for stop loss and take profit levels. Any SL or TP given on my trades are my own I have used for my trade and are not recommendations for you to use. If you are not sure, then you do not have a trading plan for yourself in place. I suggest you make one before you continue to do any trading!

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300+ pips.. You are the beast bro..good job. Looking forward your next call.
EverythingForex PRO ForexisbizFib
Excellent inside.
You're welcome!
Hey mate,
I personally have a take profit order at .700, i see more downside to complete wave B today and wait for any signs of reversal candles to appear b4 i long this pair.
Nonetheless, thanks for the prompt update :)
It's completely possible that it could go down more and even retest 69 cents. But personally, I'm seeing 70 cents. But by taking profit at TP2, I'm taking banking the profits and keeping my head clear to see the next move. If I still have a SHORT bias, maybe the bottom will not be so clear to me. +374 pips is quite enough profit for the trade and not being greedy. One of my trading plan rules is to never try to squeeze every last pip out of a trade. Trying to hit the very bottom would break that rule. I don't know how many times I've tried that and prices would suddenly reverse on me and I end up making even less pips than I would if I had just taken profit where I should've. But Hey, more power to you if you want to keep going! Maybe you will be able to grab more pips. I'm OK with what I got. GL, my friend! Keep a close eye on that price action. When it tells you to get out, get out!
+2 Reply
SkyrEk EverythingForex
Thank you very much! I do agree with what you mentioned about not squeezing out every pip out of a trade. Congrats to you on your +374pips as well.

GL and more green pips to come!
Thanks for all the updates EverythingFX, enjoy reading them to understand how you read price action.
I'm still trying to learn elliot waves and how to count them. I was wondering if you could explain why on your daily chart you have Wave 3 ending at the low at 0.69? I had that as the end of wave 5, with wave 4 ending at the high you have labelled as the X-point of your gartley. Hence we would now be in a corrective phase. On a higher time frame for the next order wave up I had my wave 4 ending at the start of your current 5 wave pattern... and the hence the end of the larger wave 5 at the low at 0.69 as I just described above.
Any comments would be helpful to increase my understanding, thanks in advance!
See this post I did 16 days ago for my long term wave count on this pair and you'll see why I have it labeled as I do. Can you label the low at 69 cents as a wave 5 ending? Yes, technically it would be correct. But is it logical to do so? Not in my opinion. But then again, that is just my opinion.
EverythingForex PRO EverythingForex
ANALYSIS: AUDUSD: Is Wave 3 Done? If So, Where Will Wave 4 Go?
+2 Reply
Moltenmetal EverythingForex
Thanks for the updated link. I had not seen that post before - it certainly does make sense and shows how the waves cascade down... interestingly enough, I can see that the difference I described on the daily chart, goes all the way back to the monthly chart you posted of 16 days back. Where you have the move from 2001 - 2011 as a 5-wave impulse move, I had it as a A-B-C corrective... hence I have the move from 2011 till now as a 5-wave, where you have it as an ABC.
Fascinating! Thanks for showing me a different way of viewing it. Agree it is all just a different way of looking at it, and we can learn from different points of view.
Good luck with your trades, I'm only starting to write a trading plan, so not even up to demo trading yet, but I find your posts insightful.
Thanks again.
Great job! One question, are you saying that since the B leg did indeed close above the .618 on the 4hr that would be a legit call, but even though it didn't close above the .618 on the Daily this is still valid? As for me I would consider anything that closes beyond the .618 but does not exceed .786 a valid Gartley also, I just don't understand what you meant about the daily chart.
The Gartley rule I follow for the B point is that prices must at least reach the .618 but cannot CLOSE above the .618. If it closes above the .618, I treat it as a crab pattern. If prices reach the .786 at all, it's no longer a Gartley or crab. It's a butterfly. If you don't make that distinction about the B point, then essentially, you have the Gartley and the crab with the exact same B point rule. But again, that's the rule I follow and seems to work out well for me. I'm not saying I am right and you are wrong. Scott Carney did not make the distinction very clear in his books. But in his examples of the Gartley pattern, prices never close beyond the .618 although the wicks sometimes goes beyond the .618 but not to the .786.
xtraderfx PRO EverythingForex
Yes I agree having strict rules for each pattern is necessary, as for me I do not trade Crab patterns often. If I'm being strict with my rules then I would like to see price close beyond the .618, most of the time I accept a .50. Makes sense though as now that I think about it I've seen plenty of patterns with the formation as you stated and they definitely proved to be correct. Great job, thanks!
xtraderfx PRO xtraderfx
Follow up to anyone that might have been skeptical on the ratio. I reviewed H.M Gartleys book and other sources and I do not see anything that states a candle has to close beyond the 618 for an official Gartley. As long as the price reaches somewhere above that level it is legit. Yes theres plenty of times the candles do close beyond that level but regardless if it reaches that point it can be ruled in as a Gartley.
You and anyone else are completely free to do as you wish. I've been trading advanced patterns for years and the rules I follow work very well for me. For me, I follow Scott Carney's rules for patterns. Candle cannot CLOSE beyond the .618 to be a valid Gartley. If it CLOSES beyond the .618, It isn't a Gartley. It's something else. This is the rule I follow in my trades. If anyone does not agree, free to not follow my trades.
+1 Reply
Hi man!
Thanks for 300 pips!! The trade plan was perfect, your analysis is amazing.
Waiting now for the next wave :)
you're welcome!
+1 Reply
Still you think AU still need to confirm 0.70038 ? It missed for few pips and are going up.... Its also a channel base to me...the under side of a channel from 2013 April
Still no bullish price action yet. I still see bearish price action. Still can go down more. I'm staying on the side for now.
+1 Reply
AhmadFarhan EverythingForex
where can i start learning harmonic price patterns, whats your trusted and best recommendation
KINGRI AhmadFarhan
I don't see the reason to be long AUD given slow down in China and easy policy of RBA?
+1 Reply
EverythingForex PRO HumbleTraders
Sorry, my trades are not based on fundamentals.
+1 Reply
I am very new to Binary Trading and I like the way you explain the outlook of the currency pair. I am still trying to grasp the concepts. I have a broker for now. Thanks
any update about this trade? plz
What kind of update are you asking for? I don't update every trade hour by hour, sir. Yes, I know prices are dropping. Just as I said could happen in the trade description above. I have my stops on this trade near 69 cents below the lowest low so this drop does not concern me at all. It was anticipated (though not welcomed). I am not going to micro-manage this trade as it is a LONG TERM trade for me. I can afford the risk under my trading plan. It sounds as if you are worried about losing money while the prices are dropping now. If you are, then you should not be in the trade.
+2 Reply
SkyrEk EverythingForex
Hey mate, you are definitely not obligated to attend to such requests made by people. They are just overly concerned about their trades and desperate to hear something from you that goes in favour with their trades taken. Anyway, have a great day ahead!
Thanks, mate. I do understand why they ask. But I don't have anything to say about it I haven't already said. But thanks for the supportive words!
+3 Reply
Nice inside, thanks. I exited my short trade based on the 4H chart 20 mins ago, now considering long. I never took the time to analyze wave patterns, I just trade the clean areas if I get my PA signal, works fine for me. But after reading some of your post's, I will dig into that a bit. Thanks for putting your thoughts online here.
Stick with what works for you and stick to your trading plan. No problem with adding to your knowledge base but don't ever stray too far from your base plan if it is working good for you. Going after someone else's plan just because it seems like it works better is called chasing the "Holy Grail" Grass is not always greener on the other side, my friend. I post to help those that need help. If you are doing well, you are not in need of help, right? But in any case, you are always welcome to check out my posts and trades to see if it matches your own.
+1 Reply
Tr8erTom EverythingForex
Couldn't agree more! I'm always curious to learn and extend my knowledge, BUT everything which is new to me and I'm unfamiliar with, will be Demo traded for at least 6months. If I get constant results, well then that means I have another Instrument I can play.
Everything else will lead to losses and as most of us, I had to learn that too.
We got a nice confirmation with that Daily PIN bar, an entry on the low of the previous Day (left eye), seems a good entry to me. Money flow is also supporting the story here, I will sit back, let the market do its thing and
hopefully enjoy the ride.
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