stephenleachman
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1-2-3 REVERSAL PATTERN (TREND REVERSAL)

FX:EURCAD   Euro / Canadian Dollar
1463 0 17
The 1-2-3 Reversal occurs very frequently and has a very high success
ratio. This pattern occur at the end of trends and swings and they are
an indication of a change in trend. They can also be found within a
trading range and within other patterns as well. They take place when
the directional momentum of a trend is diminishing. Price Pushes into a
high or low (point 1) retrace making swing high or low (point 2) Price
would then form another swing high or low (point 3). Perforable I must
see point 3 Retrace at least to the 38.2 but not surpass the 61.8 Fibonacci
retracement of point 1 to 2. Once price breaks the high or low of point 2
the reversol is confirmed and target is a 100% extension point 1 and 2.

Conventional Way To Trade The 1-2-3 Reversal:


-----1-2-3 Pattern Bearish Reversal-----
(1) Wait for A deep retracement in a up trend point 1.
(2) Wait for price to reverse going back into direction of trend point 2.
(3) Wait for point 3 to retract at lease to the 38.2 but not surpass the 61.8 Fibonacci retracement of point 1 to 2
(3) Sell a break of point 2 swing low.
(4) Stop Above Point 3.
(5) Target is a 100% Extension of point 1 & 2.

-----1-2-3 Pattern Bullish Reversal-----
(1) Wait for A deep retracement in a down trend point 1.
(2) Wait for price to reverse going back into direction of trend point 2.
(3) Wait for point 3 to retract at lease to the 38.2 but not surpass the 61.8 Fibonacci retracement of point 1 to 2
(3) Buy a break of point 2 swing high.
(4) Stop below Point 3.
(5) Target is a 100% Extension of point 1 & 2.

NOTE: Remember this pattern can be found everywhere, swings, at the
end of trends, ranges and within other patterns Trade this pattern
as the market presents it and use the right risk - reward
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