Can price on the daily price action chart break and close through the major resistance level, and complete the 1,2,3 trend reversal?
This breaking out and closing through higher would be the last tick in the box that would confirm the recent upward move, following price moving downwards from the lower base that it had been forming and consolidating at for some time.
Only recently I discussed in quite a lot of depth exactly how it is that a price action market overall forms these reversals and, more importantly, how it is that you as traders can watch that price action so that you’re not caught on the wrong side of the move. In the lesson I talk about how price rarely just turns around, but more often forms a reversal like it has here by forming a base and then reversing. To read that lesson on price action market reversals go to:
How You Can Spot a Price Action Market Reversal and Take Advantage When it Happens
If price can break out and make a strong close higher it could open the potential for bullish traders wanting to hunt long trade setups. Whilst this market has been very choppy and sideways in recent times, with price now looking to make a strong 1,2,3 reversal higher, that converts to strong momentum on intraday charts (such as the 4-hour chart like you can see below).
Potential long trades would be trading at a major break in line with the push higher and the 1,2,3. When traders are taking potential setups such as these they need to take into account the space they have to trade into. In other words, how much traffic there is in the way for price to move into. The price action story is king and a major part of that is after playing your trade and managing it and where you have to manage it into.
The last thing is the ”confirmation” or trigger signal – as we often talk about, if you don’t have the best story then slapping the greatest trigger on top of it is not going to make any difference. Putting the greatest set of wheels on a dump truck still makes it a dump truck right? Of course it does. We find the great area, then the high probability trigger
Daily EURSGD Chart
Daily EURSGD Chart
4 Hour EURSGD Chart
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