Hello Traders,
Hang Seng popped from 26204, a multiple support zone to a 27093.8 level, which is shy above the 0.5 Fibonacci of the decline from 27897.9-26204. This low can be counted as a wave „2“ of lower degree and the advance since a wave „1“ that is close to being done. For this idea, the level of 26204 is to watch. A decline below this area suggests that the possible wave „2“ correction is longer in terms of price as the wave „1“ was and this is not allowed in EW terms.
One argument for this idea is that the second and often the third !one`s and two`s“ waves often correct with a steeper slope like the one before. Note the Stoch below the chart where you can observe this behavior. Another one is, that the correction looks like „similar“ ones, which is more often than not the same behavior too. And last but not least, the second wave „i“ terminates at the upper boundary of the trend channel, which is often the case within double „1-2`s“!
Another more important fact is the violence and the protest in the streets of Hong Kong, which often occurs at the start of a new impulse, suggesting a bullish price ahead.
If Hang Seng will exceed the high at 27093.8 a common target range for the move is at or around the 27250.80 level, what is the 0.618 Fibonacci of the decline. Note that an open gap exists from the trading of November 08 (27651) – 27361 November 11!
Only one thing makes me uncertain, that is the gap that occurs at today`s opening bell and it is not the behavior I like to see in an impulse move to the upside.
So, it will be interesting in the coming hours and days; let`s see how the market will answer the question we have!
Have a great week....
ruebennase
Feel free to ask or comment.
Trading this analyze is at your own risk!
Hang Seng popped from 26204, a multiple support zone to a 27093.8 level, which is shy above the 0.5 Fibonacci of the decline from 27897.9-26204. This low can be counted as a wave „2“ of lower degree and the advance since a wave „1“ that is close to being done. For this idea, the level of 26204 is to watch. A decline below this area suggests that the possible wave „2“ correction is longer in terms of price as the wave „1“ was and this is not allowed in EW terms.
One argument for this idea is that the second and often the third !one`s and two`s“ waves often correct with a steeper slope like the one before. Note the Stoch below the chart where you can observe this behavior. Another one is, that the correction looks like „similar“ ones, which is more often than not the same behavior too. And last but not least, the second wave „i“ terminates at the upper boundary of the trend channel, which is often the case within double „1-2`s“!
Another more important fact is the violence and the protest in the streets of Hong Kong, which often occurs at the start of a new impulse, suggesting a bullish price ahead.
If Hang Seng will exceed the high at 27093.8 a common target range for the move is at or around the 27250.80 level, what is the 0.618 Fibonacci of the decline. Note that an open gap exists from the trading of November 08 (27651) – 27361 November 11!
Only one thing makes me uncertain, that is the gap that occurs at today`s opening bell and it is not the behavior I like to see in an impulse move to the upside.
So, it will be interesting in the coming hours and days; let`s see how the market will answer the question we have!
Have a great week....
ruebennase
Feel free to ask or comment.
Trading this analyze is at your own risk!