Technician

This is How the 5-0 Pattern Looks Like #forex

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FX:EURNZD   Euro / New Zealand Dollar
This is not a forecast that the pattern will complete. This is just an illustration of the harmonic 5-0 pattern. (Price could go in any direction from current levels).

The Pattern
  • The first requirement for the pattern is a new low that exceeds the prior low( Point B and X)
  • Point B should be within the range of 1.13 and 1.618. Shouldn't exceed 1.618 extension of wave XA
  • A rally should followe now, creating wave BC , where it should reach at least near the 1.618 extension of wave AB, and can reach up to 2.24.
  • A correction of wave BC should follow, the correction should complete wave CD at point D.
  • Point D should be around 0.5 retracement of Wave BC . Thats the "Potential Reversal Zone" OR PRZ of the pattern
  • This is not a place where you immediately Buy. Its a place to look for buy confirmation signals over the lower time intervals.

As you can see, the pattern on chart is still a potential pattern, and far from complete. So that doesn't mean that we should look to short now looking for a move to point D.


Good luck
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Technician

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