#AUS200: Playing a Descending scallop pattern
Descending scallop is a pattern that can be traded long or short.
The price comes down forming a elongated rounded bottom then has a throwback. The high before the throwback (small dump) is the breakout level upwards.
The lowest point of the rounded bottom is the breakout level downwards.
So first we need to wait and see if there is a throwback - unless we have this then its not to be classified as a descending scallop pattern.
The idea is to short at the throwback swing high, covering long at the bounce described below.
Then if the throwback holds around the 0.618 fibonacci level you can look for longs when it breaks upward out of the high of the swing before the throwback its confirmation of the breakout. Invalidation of long is when we close under the bottom breakout level. Invalidation of short when we close above the swing high before the "Throwback".
Check linked idea for a recent idea of descending scallop.
The price comes down forming a elongated rounded bottom then has a throwback. The high before the throwback (small dump) is the breakout level upwards.
The lowest point of the rounded bottom is the breakout level downwards.
So first we need to wait and see if there is a throwback - unless we have this then its not to be classified as a descending scallop pattern.
The idea is to short at the throwback swing high, covering long at the bounce described below.
Then if the throwback holds around the 0.618 fibonacci level you can look for longs when it breaks upward out of the high of the swing before the throwback its confirmation of the breakout. Invalidation of long is when we close under the bottom breakout level. Invalidation of short when we close above the swing high before the "Throwback".
Check linked idea for a recent idea of descending scallop.
Commentaire:
Will be watching if AUS200 finds support here now its had the throwback so it can be identified as a descending scallop pattern
Ordre annulé:
Never held the fibonacci level so no entry on long.
