GBPJPY undergoing wave B corrective structure. Short term will be watching for sell setup up TP 158.XX.
Longer term will be watching for long setup to ride on wave C of corrective structure
On 60 mins chart. price has performed two section (A&B) of an ABC correction. Shaded blue area represent end of Wave C target where we will look for reversal candles for a short setup.
Wave C target is derived from a confluence of fib levels where internal retracement 76.4%, APP 100%, external retracement 127.2% created a narrow trading zone.
End of wave 5 target reached. From here, we can expect price to move into an ABC correction.
Bearish evening star provided the setup for short position targeting end of wave A.
NZDUSD making a potential ABC correction, so far 2 section of formation has been completed: point A & B. We have identified a potential price zone for its corrective reversal by establishing the following:
Internal retracement at 61.8% forming a tight price zone with
APP at 100% (from O to A from B) +
external retracement at 161.8%
We will be looking for...
Buy on retest of support ard 1.2197 (fib 38.2%). Target: 1.2374 (61.8% fib level). SL 1.2152 (previous high close)
Risk reward:
Reasons to long:
a) close above DMA signal change in trend
b) Price action has broken short term resistance
c) MACD indicates continued upside momentum
