Looking at FX:XAUUSD on 4 hour, we see a valid Pattern that has already been completed, with the market currently at the entry point (78.6% Fib level). We also got a measured move BUT not a move, since we never retraced back down to the 61.8% Fib level of AB leg. It would be better to take the partial profits at the 50 MA (magenta line) since market respects this MA quiet well and we don't want to give back all the profit we have made just for few pips. Thus consider taking half of the profits at the 50 MA instead of 38.2% Fib level. Secondly, the stop loss is placed couple of pips above the X point BUT keep in mind that it is not above the highest high (marked by the blue on the chart above). The reason being that the risk to reward becomes quiet unfavourable if we were to place stops above that highest high, so do keep that in mind.
KEY NOTE: Since the D point never closed above the X point, the is still VALID. Our short entry would still be at the 78.6% Fib retracement level.
Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Thank you everyone for all the SUPPORT that you have given me so far, I truly appreciate it. Good luck everyone :)
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