EURUSD - classic 2618 trade
They say that consolidation is the best time to trade harmonic patterns and this definitely is not a lie.
If you trade bat patterns, usually you take profit at the 0.382 and the .618 retracement of the AD move.
We have reached that .618 retracement now and it's time to take profits. And immediately we have another setup, the classic 26.18 (or twenty-six eighteen) trade.
What is required for a 26.18 trade :
1. Double top : the A and C points of our bat pattern
2. Break below close below of the neckline : D -point of our bat pattern
3. 0.618 Fibonacci retracement of previous move : where we take profit now
=> all requirements for 26.18 trade are met.
What is expected to happen :
4. price retracement into previous low (Target 1)
5. 1.272 Fibonacci extension of the previous move down (Target 2)
- a potential completion of an AB=CD pattern
Stop Loss : should go minimum above the red dotted line but it is safer to put it above the structure of the double top, which would make Target 1 approximately a 1:1 risk/reward ratio.
If you trade bat patterns, usually you take profit at the 0.382 and the .618 retracement of the AD move.
We have reached that .618 retracement now and it's time to take profits. And immediately we have another setup, the classic 26.18 (or twenty-six eighteen) trade.
What is required for a 26.18 trade :
1. Double top : the A and C points of our bat pattern
2. Break below close below of the neckline : D -point of our bat pattern
3. 0.618 Fibonacci retracement of previous move : where we take profit now
=> all requirements for 26.18 trade are met.
What is expected to happen :
4. price retracement into previous low (Target 1)
5. 1.272 Fibonacci extension of the previous move down (Target 2)
- a potential completion of an AB=CD pattern
Stop Loss : should go minimum above the red dotted line but it is safer to put it above the structure of the double top, which would make Target 1 approximately a 1:1 risk/reward ratio.
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Twitter: twitter.com/NicoMuselle
► tradingview.com/u/Nico.Muselle/
Twitter: twitter.com/NicoMuselle
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