From what we know about trading, we know that there is really only 3 ways the market can move. It can go up, down or sideways. Sideways movement is called consolidation. In consolidation we get to use Fibonacci ratios to determine probabilities of success by selling or buying a 5th move of a 4 move prediction. In this case. we have formed what many would refer to as a . The rules for this pattern and the specific ratios are not the common ones as these have been tested and adjusted to improve win ratio and RR. These Patterns average 55% win ratio depending on the pair and timeframe.
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