I'm using trend lines
connecting tops and bottoms--creating wedges
, as well as following channel movement. It would be aggressive to be long now, probably safer for me to wait for price to reach the red line, then short. One thing that's important for me to learn to do is to try to predict WHEN the price will intersect certain areas. In this case, I'm hoping price will retrace back up to my first short arrow as well as my second short arrow later on. I think basic vertical support and resistance
is a good way to have a "check" of the work I've done. For example, I didn't highlight it on my chart, but notice how after markup, the first short point (at the convergence of lines under the first orange arrow) also nicely snugs up under some previous lows around .806. To me, this makes it a stronger signal than the second short orange arrow convergence, which doesn't have this confirmation. I'm looking forward to watching how this plays out.