1. Approaching the downward trendline
2. Currently in an ascending channel - 90% rule
3. Currently ranging and looks ready to make a triple top
4. Overall movement RECENTLY has been bearish so bearish momentum likely to continue.
Overall reason of a short: Approaching an area of resistance that looks very likely for it to get rejected at.
Its a game of patience...
• The bearish pillar followed by a pull back correction which creates a channel – 90% rule
• Price is making a double top
• At an area of major resistance.
Price could go all the way to the top of resistance and form strong double top.
• General movement of the market is bearish so bearish momentum likely to continue
• Price has formed an expanding triangle pattern on the daily chart (price has respected this line 2 times already so likely to respect it again and its on the daily chart which makes it very strong
• Price has also formed an ascending channel on the 1 hour chart which is an...
Reasons for entering a short trade:
• Price is currently at a corrective state which has formed an ascending channel this could also be viewed as a bearish flag
• 90% rule of a channel
• Downward trend followed by correction so downward trend likely to continue
• At an area of strong daily resistance
Reasons for short trade:
1. Downward trend which is correctly in a pullback correction
2. Corrective state creates an ascending channel, 90% chance of price going to the bottom of structure, price is at the top of the channel
3. Price is also at the an area of resistance
Reasons for taking a short trade:
1. Price broke out of ascending channel - high chance of it going to the bottom of structure
2. Correctly is a corrective state which has created a neutral pattern and is currently at the top structure
3. Price is at an area of resistance that has created a double top
• Price has broken out of a bigger channel so there’s a 90% chance of it going to the bottom of structure
• Downward trend with a pullback correction so there’s a high chance of a continuation to the downside
• Price has formed a rising wedge which is a reversal pattern and is currently at the top of structure
• Price is at an area of daily resistance which...
My reasons for taking a short trade here:
1. Price has broken out of a bigger structure (an ascending channel), theres a 90% chance of it going to the bottom of structure
2. Downward trend which has created a rising wedge which is a reversal pattern
3. Price has broken out of the rising wedge
4. Downward move followed by correction which creates a bearish pennant.
• Price broke out of its bigger channel – 90% chance of it coming all the way to the downside
• Bearish impulsive move and a correction – next impulse is likely to bearish
• Correctly in corrective state which creates a bearish flag (a small channel)
• Price is at the top of the smaller channel
4 factors of taking a short trade:
1. Price is on a downward trend
2. pull back correction which creates a channel (bearish flag)
3. Price is at the top of the channel which has a 90% rule of going to the bottom of structure after breaking out
4. Price is at an area of resistance on the 4hr charts