When you watch how price travels between a myriad of potential formations, creates one only to mislead traders, then busts it and a create a new one, you start to think of a foul play. Hey, somebody must be doing these tricks to me! Hedge-funds manipulators! Do not lean towards conspiracy theories too much, just watch for new benefits from what you observe. The Market evolves constantly and plays against classic formations more and more.
Last week we talked about shorting opportinuty in eur/chf (which never showed up) and I also provided some ideas on FF about channel breaking by dollar-yen. Both pairs had something similar in price action just before they broke out from the channels. Let's have a look at both pairs as they stand today. You can clearly see the formed channels on the daily. But spot a very distinctive and common price action just before those channels were broken.
Yes, indeed, the Rocket Candles closed just under the channel slope. This close was very strong but since it was still within the boundary shorts flooded in, in hope for large gains. The channel pattern was easily broken next day as you can see. Don't you find it amusing? So, the strong close of a Rocket Candle (bullish or bearish) right at the channel slope is a serious foreboding.
No comments:
Post a Comment