Now we see clearly what price is doing in the here and now. After the extended uptrend that broke above descending triangle as I mentioned in my previous post, price entered into the distribution phase. Along the way, we see price break below the range, and push back into the range, moving within a channel of higher highs and higher lows. Price is now at a confluence area of support formed by support of channel and support of distribution range. Price is also in the process of forming a double bottom in this area. My choice of trade would be a long position to the resistance of channel which also lies around resistance area of range. Entry will be after further bullish candlesticks signals.
In the previous post I made about this, I had a upward long-term outlook for this pair. But there is something important that you may want to consider. According to the theory of market phases, after an advancing phase or uptrend, price distributes, then enters the decline phase. If we are to apply that to what is currently going on, the breakout of the descending triangle may not carry much significance and price can as well enter the decline phase and fall back into the confines of the descending triangle, thus keeping any long-term uptrend outlook on hold till further notice.
What to do? For now, we can just trade the market for what it is, which is a range. We may use appropriate range trading strategies to trade this pair for now, while keeping all the long-term considerations at the back of our minds. Cheers!
In the previous post I made about this, I had a upward long-term outlook for this pair. But there is something important that you may want to consider. According to the theory of market phases, after an advancing phase or uptrend, price distributes, then enters the decline phase. If we are to apply that to what is currently going on, the breakout of the descending triangle may not carry much significance and price can as well enter the decline phase and fall back into the confines of the descending triangle, thus keeping any long-term uptrend outlook on hold till further notice.
What to do? For now, we can just trade the market for what it is, which is a range. We may use appropriate range trading strategies to trade this pair for now, while keeping all the long-term considerations at the back of our minds. Cheers!