moneymaking
Long

AUDUSD: 2618 TRADE SETUP (4 HR) !!

FX:AUDUSD   Australian Dollar/U.S. Dollar
484 17 10
UPDATE #2: Stop loss has been hit, all positions are now closed.

UPDATE #1: Trade is active now.

Hello Traders

Here we've another potential 2618 trade setup that is close to completion but this time its on AUDUSD             . Market has broken structure (previous LH), signalling a POSSIBLE change in trend at least for short term. See the chart for more details.

I would just go over the 2618 trading strategy very briefly here but I will post a link, below this description, of the full 2 HR+ training video for this strategy. This video is made by Jason Stapleton, from Trade empowered, go check out their website for more information, they are AWESOME !!

2618 TRADING STRATEGY

1. The first thing we need is the market to be in a clear trend (either bullish or bearish ).
2. Then the market must make a double bottom (if we're in a bearish trend ) or double top (if we're in a bullish trend ). In the trade setup above, the market is clearly in a bearish trend .
3. Next, the market needs to BREAK and CLOSE below previous structure to signal a POSSIBLE change in the overall trend. If market is in a bullish trend then it must break previous HL, if
the market is in a bearish trend , then it must break previous LH.
4. Then we need to wait for the market to retrace back into the 61.8% Fib level. The Fib level is drawn from the bottom to top of the leg (for bearish trend break) or from top to bottom of the
leg for bullish trend break) that broke the previous structure.
5. Our entry is at the 61.8% Fib level BUT taking the spread into account, makes our true entry just above the 61.8% Fib level (for long position) or below the 61.8% Fib level (for short
position).
6. Stops will be placed 10 to 20 pips below the low of the double bottom (for long position) or above the high of the double top (for short position).
7. Our 1st target will be at the close of the last candle, from where the market started to retrace back to the 61.8% level. For the AUDUSD             setup above that will be at close of the big green candle.
Our 2nd target will be at the 127.2% Fib extension that is drawn for the leg that broke the previous structure (LH or HL).

I believe I have covered everything in this short outline for the 2618 trading strategy. If you would like to get more details on this strategy or see more examples on the charts, then check out the training video, link is posted below.

Here's the link for the 2hr+ training video: https://www.youtube.com/watch?v=Esx1CLtq-18

Here's the Trade empowered website: http://tradeempowered.com/

Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Good Luck :)
UPDATE #2: Stop loss has been hit, all positions are now closed.
Reply
This should provide some short time buying. Or closing of shorts which would result in buying.
Your 2618 is the pattern's traders TP2.

snapshot
+1 Reply
moneymaking PriceActionTrading
Nice one Price, was that a bearish cypher pattern? I think we got the big downward movement due to the news out of AUD at 9:30 pm and then 11:05 pm.
+1 Reply
I do not mind myself with news nor the name of the pattern. it was a valid pattern and it traded well. right now its at TP2 of those pattern, so all pattern traders should have exited their shorts, causing buys. I wont exactly say AUD is a buy now. It is merely traders exiting their positions. Thats my opinion. I wont long AUDUSD. Caution with your trade my friend. really nice analysis by the way. detailed :)
+1 Reply
moneymaking PriceActionTrading
Great, Yes, the overall trend is definitely very bearish. Will be watching this closely. Thank you for the kind words :)
+1 Reply
moneymaking PriceActionTrading
I believe all harmonic patterns have certain ratios that must be met, in order to call any harmonic pattern valid. I am just curious to know that how did you come to the conclusion that this pattern is valid? I might be misunderstanding your approach on this.
+1 Reply
moneymaking PriceActionTrading
If it is a cypher pattern, then according to my rules, we never got the C point completing at the 127.2% fib extension level. Thus, making the pattern invalid.
+1 Reply
Yup i understand. I am no pattern trader but i am more flexible with my rules.
Sometimes i use only closing price to draw my patterns.
See below chart and you will see that 127.2 has been fulfilled my friend.
And you will see that pattern completion @ 78.6% is fulfilled nicely too.
Just my flexible rule.
snapshot

snapshot
+1 Reply
moneymaking PriceActionTrading
Great, thank you for illustrating your approach. Highly appreciated :)
+1 Reply
Anyways i see a nice 2618 at EURJPY. 61.8 at previous structure too. Posted that idea too last night.
snapshot
Reply
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