In that post, I suggested that we would be seeing a sharp drop coming in what would probably a wave 3 of 3 of 3 type drop. Well, here it is! But from my perspective, there is still more to drop. If this is a wave 3 move, then of course, there is going to be a wave 5 yet to come to complete this impulse wave. Yes, that also means that the next move must be a wave 4-type move. Question now becomes when?
To answer that question, there is now a completed . Can this be what signals the end of this wave iii of ( iii )? It is possible but it's not a bat I would take as this would be going counter-trend against a wave iii drop. The proverbial "catching a falling knife".
MY TRADE PLAN
Full disclosure: I actually had closed my SHORT position on this trade earlier and broke one of my own trading plan by closing a trade prematurely and not letting my stops take me out. But that doesn't mean this analysis is not correct. Anyway, I won't be taking a LONG trade off this bat because I believe that there is more downside to come. Instead, I'll be looking for another SHORTING opportunity although it may not happen till next week after the NFP. Or the NFP could trigger another move down.Can't tell for now.
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Anyway, back to you question, I saw that this wave 3 was not complete so I knew it was to fall more. So I knew that I needed to extend the end of the wave. I originally projected all the way down to the origination of the bat pattern (the X point) but I soon realized that wasn't gonna be enough. So my further projections use fib level retracement and projections to try to find a good level to trade from.
Hope that helps!
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