USD/CHF: short at market after AB=CD completion
I based this idea on an idea from another member (www.tradingview.com/u/FullTimeTrader/)
If you agree then make sure you like his idea first (see linked idea)!
The bat pattern in the original post if not valid anymore for me since we had a significant selloff at the 0.786 level.
I am a bit worried about a possible butterfly pattern (not drawn here, I might post it later) which could be forming, in that case we will continue higher and possibly even overshoot the January high!
The AB=CD pattern in the chart however is a perfect AB=CD pattern as described by Scott Carney in his book Harmonic trading (Vol. 1), i.e. a 61.8 retracement of AB forming the C point and D at a precise 1.618 projection of BC!
A 50% to 61.8% retracement should be expected now if this pattern works out. A perfect bearish 3 drives pattern could follow which would mean a retracement to 61.8 followed by another 1.618 extension.
Because of this I will take 3 targets:
- TP1 at the 38.2% retracement (30%) >> partial profits booked, SL remains
- TP2 at the 61.8% retracement (50-60%) >> main target, most profits booked, SL to BE or TP1
- TP3 at the 88.6% retracement (10-20%) >> additional target at previous structure
SL above structure resistance.
In case this setup fails I will short again if we reach the January high level.
If you agree then make sure you like his idea first (see linked idea)!
The bat pattern in the original post if not valid anymore for me since we had a significant selloff at the 0.786 level.
I am a bit worried about a possible butterfly pattern (not drawn here, I might post it later) which could be forming, in that case we will continue higher and possibly even overshoot the January high!
The AB=CD pattern in the chart however is a perfect AB=CD pattern as described by Scott Carney in his book Harmonic trading (Vol. 1), i.e. a 61.8 retracement of AB forming the C point and D at a precise 1.618 projection of BC!
A 50% to 61.8% retracement should be expected now if this pattern works out. A perfect bearish 3 drives pattern could follow which would mean a retracement to 61.8 followed by another 1.618 extension.
Because of this I will take 3 targets:
- TP1 at the 38.2% retracement (30%) >> partial profits booked, SL remains
- TP2 at the 61.8% retracement (50-60%) >> main target, most profits booked, SL to BE or TP1
- TP3 at the 88.6% retracement (10-20%) >> additional target at previous structure
SL above structure resistance.
In case this setup fails I will short again if we reach the January high level.
