Breakdown: 1. Note 2. Contents 3. Research breakdown 4. Education recap 5. Information on Lupa.
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged neutral, until the opportunity for a close reaches the profit taking zone. This will be activated as long, where an imbalance is formed and sellers have completed the changing of hands due to purchasing further increments the exhaustive sellers.
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities. However, note - the overall trend is bearish
Master Key for zones
Red = Three Month
Blue = Monthly
Purple = weekly
Scarlet [Red] - Four day
Orange = Daily
Green = 8 Hour, 16hour
Grey = 4hour
Pink = 1 hour
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Monthly This upper imbalance has been established through the top of the wick down to the close of the body on the candlestick in focus - taking place July 2017. Why here? Well this has been a previous top of the structure where price has tested by looking right to 2018 and has been rejected where no wicks have created higher highs, solely lower highs, giving the high probability of this zone being the buyers imbalance take profit zone. As with Imbalances, these are retested just like double bottom patterns and also on lower timeframes, considered consolidation patterns.
The lower imbalance which aligns with the Fibonacci extension (inverse) where a change of hands will occur with as the monthly candlesticks show a correctional two months - this whilst on the previous "covid" low - upon the rejection the imbalance formation had become this zone - reasons; 1. Price correction relieves the buying pressure and discounts additional opportunities 2. The second reason is due to the the previous Fibonacci "0" on the monthly aligns to the -0.618, -0.786 zone on the inverse Fibonacci.*[1]
See here*[1]
Weekly Chart - as posted The weekly imbalance zooming into the correction based on the engulfing move from the true imbalance rejection - formed an eight week period of trading ranges which tested tested the engulfing weekly low netting the the low [28th September 2020], allowing buyers to begin the process of establishing the trading range as well as lower time frame of a rising channel creating higher lows and higher high wicks. From here this would ensue a breakout for buyers as a well established monthly range at the pivotal level gives a 95%confidence for a buying imbalance to continue to extension targets.
Where we are at current
Review of the imbalance - using the daily chart 1. The higher low formations using the daily lower trend line captures three points from the lower anchor. 2. The "liquidity zone" has been tested multiple times where wicks have failed to equate to equal lows. 3. The final retracement of the channel fails to breach the "0" Fibonacci on the monthly - this pivotal rejection was the final tick off the checklist - now to scale and in buy upon the 4hour timeframe.
Daily Chart Bearish Continuation Judging by looking left - the zone below "0" has been tested - price will look to breakout from the low to correct to 0.694X as a test of the
4Hour correctional channel [ a low probability]
Eight hour, one Day The combination here combines both the lower lows and lower highs formation whereby prices have formed a correctional channel which has moved for one month in time frame. Price is creeping towards the imbalance zone upon the weekly and monthly zone.
Correlation; Keep up to date with the AUD USD correlation & NZD CHF
AUD USD Monthly Chart We are currently testing the imbalance - now awaiting a further confirmation that price will continue to fall back towards the previous imbalance or consolidate between 0.70 to 0.72X Price has showed consistent lower high formations with correctional weekly channels which have allowed opportunities to hedge and keep short. [1] Weekly chart shows consistent weekly shorting in motion towards the imbalance on the monthly - the monthly however is technically a profit taking zone where price will now consolidate and correct again at the Fibonacci zone "0".
The remaining zone which is an untested imbalance - shows a strong complex completion for the full Fibo extension [1]
NZD CHF Monthly chart What have the imbalances shown? The monthly sell opportunity was where price had created a "wick" high into the monthly zone but was instantaneously rejected on the daily level. This began with a two day sell off - but upon a retested, price failed to close within the desired zone on the monthly.
Do you enjoy the setups? *Professional analyst with 5+ years experience *Focus on technical output not fundamentals *Position and swing trades *Provide updates where necessary - with new updated ideas tracking the progress.
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