Description in the chart *1) Overall context: Down trend (Lower Lows and Lower Highs- Red lines)
Now, the price finally has got out from the congestion area, and is breaking the previous LSH.... so now one could expect a retracement or a consolidation and after that a continuation of the upward movement...
At this point the price has been unable to keep moving lower, therefore the most immediate down trend channel is no longer valid because it doesn’t represent the price behavior. Therefore until now after two trend channels that have failed to consolidate its movement (uptrend and downtrend) now one can identify an area of congestion where the buyers and sellers...
As mention before, the price has reached the most immediate Support area, and here is where the things are interesting ... why? ... Because at the extremes one is able to find opportunities for entry with a small risk relative to its potential profit, moreover if you are wrong in the initial hypothesis is easy to scratch the trade and be ready for re enter the...
The price has made a false break out, because there were no follow through to the downside (No followers) in this order of ideas, the price has returned to the Trend Channel, notwithstanding is important to keep an eye around the 1280-1284 (Resistance) becuse if this area is able to hold is most likely that we are facing a trading range but in the other hand, if...
The price is above the upper limit of the downtrend channel which has been consolidating during the last 2 and a half years, and now in the most immediate context the price action fits into an uptrend channel, therefore in order to look for entries one could play the break out, the pull back or the Reversal, all of it taking into account the boundaries of the blue channel
If the price breaks the LSH I would enter long, of course the succes of the trade depend if there are demand above the 35.20 --- lets see how it goes
We seem to be in a trading range at least some supply is showing above the 114.5 resistance area, therefore I am going to be looking to enter short in order to play the trading Range. Regarding to the management I wil take half of my position if the price reach the 1:1 Risk: Reward this in order to have a free risk trade an let the other half to run until itsd...
The price fits into a congestion area therefore I would wait until the price confirms its intention to move to one side or another
Now that the price has not been able to hold the 1.1071 area, the market is confirming the inmmediate downtrend, the first taget could be placed around the 1.09800 where is located an important level of resistance, and also close to that area is the Lower Limit of the Trend Channel where one can expect to find some demand, in this order of ideas there are two...
Shorting the break of the previous Swing Low 4h --- lets see if the trade is triggered
Looking for trading opportunities at Swing Points
Waiting for pullback and a price action pattern in order to enter short looking to ride the overall downtrend
After the Fail Bo of the resistance area + some clues of rejection (Black Arrows) + If the price is unable to found demand around the most immediate Uptrend channel then I will enter short --- Target the 1.366 area
Trading Context for USDMXN: Explanation on the chart