The first point that I want to make is this: the analysis that I write is based on the configuration of the which is not established yet. It has about 14 hours before it closes which means it has plenty of time to change. It can get weaker which is what I would prefer, or it can close strong which will prevent me from taking any action. TA helps to define multiple scenarios, and then you adjust to what the market chooses, you don't react.
IF the closes and the next candle continues lower, I am looking for price to present a shallow reversal between the 9956 to 9723 minor (.618 of recent swing). Since this zone is relatively narrow, a break lower will bring my attention to the 9280 swing low. IF price can produce a reversal pattern within these price areas respectively, I will be looking to add 30% to my position.
IF price falls through these levels, (anything is possible) then once again I will be eyeing the 8171 to 7329 minor support (.618 of recent structure) for reversals. Keep in mind the likelihood of this scenario is lower since this market is still within the boundaries of a impulse wave.
I am looking at the current swing as a Wave 1 of a Wave v. The next minor retrace would be the Wave 2. Breaking below the 9280 low will negate this count and imply that this market is in a consolidation that will have to be identified further as it unfolds. If the Wave 2 establishes itself, then Wave 3 should carry price back up toward the 11700 swing high, and likely break higher. Many people get confused when it comes to the subjectivity of , but remember it is best used to provide a general road map or guide. As the market changes, it offers criteria and categories to base ideas on, expecting more than that is not realistic.
In summary, looking ahead and preparing is much more effective than reacting. Inexperienced traders may focus on the and look to sell, but may quickly overlook the context of the situation surrounding this formation. With the impulse wave still intact, this market is still has a short term bias which reduces the weight of formations like a , or lower high until the impulse is negated. This information alone should at least help you to look for support levels to hold rather than break, and more importantly to anticipate reversals. This is how understanding context guides your decision making process which is much more effective than simply reacting to a candle formation alone.
Questions and comments welcome.