Perhaps even more than the Bump & Run Reversal Pattern being formed, what's sparking my attention in this market is the beautiful distribution patterns which this market registered before the downtrend which appears to be transitioning to an accumulation stage now.
Look how this market displayed an erratic price action since 2018, forming that final and chaotic base before the sell off.
Look at how it produced a RSI bearish divergence at the right end of the base, before devil cross and breakout below the base's support.
That's chart poetry. What can you learn from it?
- Get away from late stage bases.
- Do not trade breakouts formed with RSI divergences.
- Use this late pattern as a bearish trigger for the bold traders out there.
What else? Oh,, of course, the B&R reversal pattern. Can you see it as well? A bullish trade here is very difficult to execute nevertheless. Primarily because if we wait for a breakout from that trendline/10 EMA, then we will be left with a poor risk to reward ratio for this trade. So it needs a bullish trigger as close as possible to the current support area.
No matter what you do, remember that this is a game of odds, not of certainties. Therefore your number one priority at all times should be to manage risk diligently.
Cheers,
Tenacious Tribe - Quantified Trading Strategies & Studies
Look how this market displayed an erratic price action since 2018, forming that final and chaotic base before the sell off.
Look at how it produced a RSI bearish divergence at the right end of the base, before devil cross and breakout below the base's support.
That's chart poetry. What can you learn from it?
- Get away from late stage bases.
- Do not trade breakouts formed with RSI divergences.
- Use this late pattern as a bearish trigger for the bold traders out there.
What else? Oh,, of course, the B&R reversal pattern. Can you see it as well? A bullish trade here is very difficult to execute nevertheless. Primarily because if we wait for a breakout from that trendline/10 EMA, then we will be left with a poor risk to reward ratio for this trade. So it needs a bullish trigger as close as possible to the current support area.
No matter what you do, remember that this is a game of odds, not of certainties. Therefore your number one priority at all times should be to manage risk diligently.
Cheers,
Tenacious Tribe - Quantified Trading Strategies & Studies