I guess everybody is seeing some sort of daily / weekly trendline above cable right now, which is now resistance instead of support. Like with most trendlines, you can move these around and still have a valid line. Trendlines are not very precise. The way I've drawn it on the chart right now is as if the last impulsive move on cable already happened. But it doesn't really matter where it is exactly, it is somewhere up there. Later when price has moved away the exact location will be a bit clearer.
As I stated in previous post -0.236 is primary target of a fib trade, -0.618 secondary.
Now left to right:
Fib 1 is displaced to the left. It should actually be drawn ontop of fib 2, it is only there to show you something amazing. If you would have used this fib to trade long have a look at the 1st and 2nd target. See how price exactly responded to these locations.
Fib 2 shows what happens if you would have taken the anchor above as fib and traded that, also makes perfect sense in terms of reaction on those levels. So what I see here is that gbp traded both targets in both scenarios.
After those longs a correction makes us redraw to the new high
Fib 3 is the redraw. See the reaction at its 1st target. Now secondairy target is above or around the trendline depending how you draw it.
Fib 4 shows the current long, with its target also very close to the 2nd target of fib 3
The green line on top of the chart is the 38 level of the biggest fib on the higher timeframe.
Conclusion:
I expect 1st target to be touched on fib 4, this would also complete fib 3's 2nd target. Since I expect the trendline to be resistance again this is where I am looking to sell those highs. Doing so without broken long setups is kind of top picking you can also wait for bearish price action to appear and long setups to be broken.
Now, how does this bigger timeframe move down fit in the whole QE and taper story and how does this correspond to my audusd longs. No idea, I just follow price around on smaller timeframes trying to get in cheap at the right levels and hold on. If the trendline is broken, we'll know soon enough.
As I stated in previous post -0.236 is primary target of a fib trade, -0.618 secondary.
Now left to right:
Fib 1 is displaced to the left. It should actually be drawn ontop of fib 2, it is only there to show you something amazing. If you would have used this fib to trade long have a look at the 1st and 2nd target. See how price exactly responded to these locations.
Fib 2 shows what happens if you would have taken the anchor above as fib and traded that, also makes perfect sense in terms of reaction on those levels. So what I see here is that gbp traded both targets in both scenarios.
After those longs a correction makes us redraw to the new high
Fib 3 is the redraw. See the reaction at its 1st target. Now secondairy target is above or around the trendline depending how you draw it.
Fib 4 shows the current long, with its target also very close to the 2nd target of fib 3
The green line on top of the chart is the 38 level of the biggest fib on the higher timeframe.
Conclusion:
I expect 1st target to be touched on fib 4, this would also complete fib 3's 2nd target. Since I expect the trendline to be resistance again this is where I am looking to sell those highs. Doing so without broken long setups is kind of top picking you can also wait for bearish price action to appear and long setups to be broken.
Now, how does this bigger timeframe move down fit in the whole QE and taper story and how does this correspond to my audusd longs. No idea, I just follow price around on smaller timeframes trying to get in cheap at the right levels and hold on. If the trendline is broken, we'll know soon enough.