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Mikoxl.
Jul 30, 2015 6:22 PM

Alternative bat as a test of the broken channel Long

New Zealand Dollar/U.S. DollarFXCM

Description

Reading the chart
After the pair broke out to the upside, it came back to test the broken channel.
Now, this breakout represented itself as a completed harmonic pattern: the alternative bat.
Also, the RSI (7) is heavily oversold and comparing this strength with the previous low (close) it tells me that the bears were sold out too soon. Therefore, this could mean a hidden bullish divergence and should indicate that the retracement upwards should continu.

Setup
Entry: 0.6581
SL: 0.6547
target 1: 0.6640. risk/reward: 1:1.74
target 2: 0.6677
target 3: 0.6737
Comments
IvanLabrie
More than 23.6, doubtful.
If offered I'll fade it. (selling)
Mikoxl.
Yes it is a risky trade. Over the last 2 weeks there was still a lot of downward pressure. However, the bears couldn't close lower. In fact, the bulls gained a little with the closes. Nonetheless, an alternative bat at structure over should give me some profit over time.

I set my stoploss at 0.6547, but there is a wick on the 4H I'm paying attention too. Any close below could mean this setup will fail.
IvanLabrie
If in profit getting out quick is safer in general, when going counter trend.
Trend is still heavily down.
I didn't get a fill yet, was inching from my sell short level.
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