As these posts are mostly for my education and entertainment, do not take them as trading advice.
XRPUSD recently finished a leading diagonal from the low of March 13th to April 7th, where it reached a point of $0,205. I would have expected a rather sudden drop down from there, as leading diagonals do tend to lead to those.
However, there were some interesting moves since then, which I believe follow the following patterns:
After the 7th of April, we went into a leading diagonal down (marked light blue in the chart), the first leg of an ABC-correction. The A-leg ended on April 16th at $0,174, after which we saw a very swift movement up for a corrective wave. We started that corrective wave with an impulse wave, which was followed by a flat correction. Then, more zig-zag movements started popping up, which seem to have formed an ending expanding diagonal that (I believe) just ended.
If we extend the movement made by the A-leg from April 7th to April 16th from the end of this ending expanding diagonal, we would end up at $0,164. That level would also align perfectly with the end of the 4th wave of the leading diagonal on a higher degree.
So, my scenario for now is a short with a stop-loss above the end of the expanding diagonal, heading down to $0,164 for an 100% extension of the A-wave of this zig-zag. It is not impossible that this C-wave will extend further to reach a retracement of more than 50% of the leading diagonal, so $0,164 shall be my preliminary target until the C-wave is further developed.
Don't mistake this for trading advice. 'Tis but an analysis and a possible scenario. :-)
XRPUSD recently finished a leading diagonal from the low of March 13th to April 7th, where it reached a point of $0,205. I would have expected a rather sudden drop down from there, as leading diagonals do tend to lead to those.
However, there were some interesting moves since then, which I believe follow the following patterns:
After the 7th of April, we went into a leading diagonal down (marked light blue in the chart), the first leg of an ABC-correction. The A-leg ended on April 16th at $0,174, after which we saw a very swift movement up for a corrective wave. We started that corrective wave with an impulse wave, which was followed by a flat correction. Then, more zig-zag movements started popping up, which seem to have formed an ending expanding diagonal that (I believe) just ended.
If we extend the movement made by the A-leg from April 7th to April 16th from the end of this ending expanding diagonal, we would end up at $0,164. That level would also align perfectly with the end of the 4th wave of the leading diagonal on a higher degree.
So, my scenario for now is a short with a stop-loss above the end of the expanding diagonal, heading down to $0,164 for an 100% extension of the A-wave of this zig-zag. It is not impossible that this C-wave will extend further to reach a retracement of more than 50% of the leading diagonal, so $0,164 shall be my preliminary target until the C-wave is further developed.
Don't mistake this for trading advice. 'Tis but an analysis and a possible scenario. :-)