Betting on pullback patterns recently has been a lot more trouble than it's worth, but there's is a good case to be made for us having completed 5 waves up now and be due a pullback to close to 4000.
I've become wary of betting on pullbacks because a lot of them just do not come and others come from a bit above the expected resistance level. Stops therefore have to be a bit wider and the RR on shorts it just not viable (Especially with sharp turns eating profits and reaching stops). Price has blown through all the small chart pullback patterns on the way up. It may do the same with this bigger chart one - but I think a lot of short term risk for bulls in this area.
We have a W like formation in the recent price action. These harmonic structures are always useful for projecting the big SR levels. Here if the harmonic is going to work we're into the early part of the turn and the near term action is bearish (Albeit essentially range based on bigger charts). If the harmonic fails, there will usually be a strong momentum rally.
Both of these are net bullish setups. It is also possible a butterfly is forming to make a big important top, you'll find these in the 1-4 hour chart action of a lot of tops. However, for this to be a credible risk to the bull trend we'd have to break the basic higher low structure with the last important low being around 3900.
Forming a W structure, spiking out high and then making a false breakout of the recent lows is all stuff entirely consistent with the Elliot wave uptrend structure. We'd be completing wave 5 now.
I think there's good odds on the short here. First stop in a while where I think the chances of a bigger short working and the RR available on the required stop is worth it. Would be very quick to quit on this if it was not working. If the grinding action of the small timeframes occurs on the big timeframes, it won't be any fun being short. Breakouts trigger longs.
While there does look like good value for bears here, I'd be cautious of bear traps if selling starts. Anything above 4000 is not a break. If bears can get under 4000 there's a better case for an important high being made. For now the odds would firmly favour buying the 76 dips using tight stops. An ideal setup would be a big 76 retracement coming now.
I've become wary of betting on pullbacks because a lot of them just do not come and others come from a bit above the expected resistance level. Stops therefore have to be a bit wider and the RR on shorts it just not viable (Especially with sharp turns eating profits and reaching stops). Price has blown through all the small chart pullback patterns on the way up. It may do the same with this bigger chart one - but I think a lot of short term risk for bulls in this area.
We have a W like formation in the recent price action. These harmonic structures are always useful for projecting the big SR levels. Here if the harmonic is going to work we're into the early part of the turn and the near term action is bearish (Albeit essentially range based on bigger charts). If the harmonic fails, there will usually be a strong momentum rally.
Both of these are net bullish setups. It is also possible a butterfly is forming to make a big important top, you'll find these in the 1-4 hour chart action of a lot of tops. However, for this to be a credible risk to the bull trend we'd have to break the basic higher low structure with the last important low being around 3900.
Forming a W structure, spiking out high and then making a false breakout of the recent lows is all stuff entirely consistent with the Elliot wave uptrend structure. We'd be completing wave 5 now.
I think there's good odds on the short here. First stop in a while where I think the chances of a bigger short working and the RR available on the required stop is worth it. Would be very quick to quit on this if it was not working. If the grinding action of the small timeframes occurs on the big timeframes, it won't be any fun being short. Breakouts trigger longs.
While there does look like good value for bears here, I'd be cautious of bear traps if selling starts. Anything above 4000 is not a break. If bears can get under 4000 there's a better case for an important high being made. For now the odds would firmly favour buying the 76 dips using tight stops. An ideal setup would be a big 76 retracement coming now.
