If we look at thew broader view, the clarity is shocking. Could it be this simple? IWM completes the descending wedge (with minor peaks and valleys along the way, i.e. June 5th ECB, then BOJ next week, then FED, then other currency wars & rumors of wars, etc.) until it reaches again the pivot point of 107.24 ish, and then has to make a major moment there.
Comments
timwest
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How to you trade this idea? Short right here at the open today? Stop loss at 114+? Target 107? Maybe a higher target like 108? What will nullify this pattern? How is this simple? Expanding patterns are often very difficult and stop out traders again and again. I'd love to hear what your thoughts are. Cheers. Tim
claydoctor
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This not a trade, it is an observation on a long term trend. I keep this in mind when doing individual trades, as well as how it continues with certain currency pairs.i.e. EUR/JPY. I always check minute, daily, weekly before I execute a trade, and would not trade something that violated the extremes or the trend of this wedge on an overlay of the IWM , EUR/JPY and whatever I am trading. I believe it will take something monumental to keep the IWM from completing a descent to 107.24.
timwest
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If you have that level of confidence about a descent to 107.24, then I'm curious to read how you think it can be traded. When I ran a traders group for years and we met every month, we would turn "trading ideas" into "trading plans" to help people achieve their financial goals. What I see is the same for you, that you have an idea. So, let's turn it into a plan. I'd suggest at the most, risking 3 average true ranges (11-day ATR) from whatever entry you choose. If that violates, then indeed something monumental is going on. All the best, Tim
claydoctor
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Love the idea of a trading club, online, and was hoping for this to be that,m but it is not. If you started something I would join. Next, watching this chart very very carefully, and actually have been on the sidelines for the past 10 days watching this market. ECB Thursday, employment Friday, and BOJ next week are big events that could cause this wedge to break top line or confirm its descent. Where I have been successfully aggressive lately, I am cashed out for now. Watching world bank decisions, then currency pairs, then stocks in that order, one ripples the next. Watching EURUSD of course, after the ECB decision. I believe if this pair reacts up, markets down and confirms descending wedge, if the reaction down, markets up, and could break top line wedge trend. And then to what degree do they hold or declare their own version of QE will result in if we break and close above or below the top trend line, just IMO.