Our pair is currently in an ascending triangle pattern, which according to the Theory, is about to break. We have two scenarios:
First scenario: (Yellow)
- Price breaks the triangle
- Goes 60 pips down to the trend line
- Then goes back up in a bull run
Second scenario: (Red)
- Price breaks the triangle
- Goes 60 pips down to the trend line
- Breaks the trend line (*)
- Retests and then rides the bears till the next major S/R level
(*) In the long run, there's a reason that the price could possibly break the trend line and that is because in the long term chart the price is in a bullish flag pattern which is a correcting wave after a huge fall.
First scenario: (Yellow)
- Price breaks the triangle
- Goes 60 pips down to the trend line
- Then goes back up in a bull run
Second scenario: (Red)
- Price breaks the triangle
- Goes 60 pips down to the trend line
- Breaks the trend line (*)
- Retests and then rides the bears till the next major S/R level
(*) In the long run, there's a reason that the price could possibly break the trend line and that is because in the long term chart the price is in a bullish flag pattern which is a correcting wave after a huge fall.
Note
Eyes on S/R reaction of the price...
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.