Looking back at the week, I notice now that this price action was very logic for the following reasons :
1. We completed a patter so we can expect a retracement to the upside.
2. The classical retracement levels for a are the 0.382 and the 0.618 fibonacci levels, which we had not reached yet.
3. There was also the 2618 trade ( , break of neck line and ) where we did not reach that same 0.618 .
All of the above pointed in the direction that there was more to the upside on this pair, but as I was biased on looking for short opportunities I failed to see them. Luckily there is such a thing as the weekend where we reflect on the trades from the last week and now it seems all very clear to me.
Lesson learned : Trade what you see, not what you want to see !
Where are we now ?
1. The of the has been reached, the 2618 pattern is ready to be traded.
2. We are at a level that has served as resistance several times in the recent past.
3. We reached the of the pattern as well, but did not reach the 0.786 (which could be an indicator for a potential taking price higher)
What will it bring us ?
Personally I will not jump into the trade first thing Monday morning. I will watch price action closely to check if this level holds. Then there are 2 possibilities :
4. Price action breaks and closes above 1.09 => we can expect the big to be tested again.
5. Price action tests the level again and fails to break it => we can now short and look for the 0.382 and . Even a test of the lower is possible (100% retracement)
Have you been caught in a short bias as well, has this pair tricked you too ? Or did you manage to catch the whole move up ? Your comments are always welcome below !
Price then moved back down, hit support with a double bottom, a bounce back to complete an AB=CD pattern and a potential continuation to complete a bearish Gartley, although this is not shown in your chart.
As for the move at the beginning of next week, for me it can go both directions, if I look at the dollar index, this is likely to go up, which would support the EU going down, but I'll closely monitor price action on Monday morning to check what direction we will be heading instead of making my mind up now :)
I agree with the alternatives exposed and my analysis is pretty much inline with yours.
I was also caught with short orders and kept adding with each minor retracement :(. On the other hand, I took advantage of the final strong rejection at 1.09 and finally closed them all with some overall loss. Its all part of the game in the end and what matters is to play it safe and stay in the game. Cheers and have a pipfull week :)
As for your chart above, I doubt we'll complete the bearish butterfly as the support/resistance is very strong. I'm convinced that we'll stay below that level, but I will not make the same mistake by being biased ... I'm prepared for whatever happens... Bring it on ! :D
Personally this move tricked me, I sold at the 618 retrace of the bearish bat and saw the opportunity to sell at the double bottom that formed around the $1.06740 level but held it.
In the weekend I placed my stops at exactly $1.0925 and I'm looking at taking profits at the $1.06640 levels, which is again at structure.
Thank you so much for your insights :) Blessings
It's easy to provide comments in hindsight ... , but where are your charts ? ;)