Saturday 4 February 2017 @ 0200 – The weekly showing buyers have stacked up in that consolidation which lasted throughout 2016. The break out of consolidation has happened and a cup and handle pattern has formed. Further upside possible.
25 and 75 SMA creating the TAZ on the daily. Price went in and out once and pulled back to currently the 25 SMA. This could also be seen as a consolidation on the 83.5 resistance zone with a break out likely.
Short term opportunity on the 4H. Catch the next swing up and ideally price breaks out completing the cup and handle pattern mentioned earlier. Otherwise, profits could be taken near the resistance zone. Trend and value ascertain, left with the trigger.
Trigger could come on the 30min chart. The new higher high formed is the reflection of the bullish candle on the 4H reference timeframe. Enter on next swing low, 30 and 90 SMA could form the TAZ as it did with the preceding down swing. 25 and 75 SMA will also do the job.
The intention here is to trade the cup and handle pattern. There is also an opportunity for short term gains which is in alignment with the longer term plan. Go for the short term opportunity but do not look to exit early, there might be more to gain in the long term if price makes a massive break.
Gap covered up by buyers. Swing low still established on the 4H timeframe.
Trigger timeframe: 30mins. Yellow box showing the gap which has been covered. A new higher low also showed that buyers were coming in. Triangle was formed within the TAZ. In anticipation of bigger bearish candles, entered at market. 1% of capital risked on a potentially more than 4R trade.
Buyers currently winning the war on the weekly, daily and 4H battle front. With previous resistance playing the role of support on the 4H. 30mins battle in progress.
As mentioned in the analysis above, there might be a bigger move to the upside. Target profit will be taken out and trade will be managed with a trailing stop.
Entry: 82.418 | Stop loss: 82.1 | Target Profit: 84
Psychology and emotions – Neutral. Perhaps towards the good side on a Monday afternoon, a bit hungry though.
Stopped out. And in fact it should be a short entry based on objective strategy. Read trades review.
After tradeImportance of stop loss, despite all the confluences.