AUDCAD GEOMETRIC TRADING (DIAMOND PATTERN )
Updated
AUDCAD is trading a Diamond pattern on its daily chart
price is trading below the breakout level 0.89755 and has target the 61%bc 0.89143
at this point price could retest the breakout level and resume it downtrend to 100%.088770
by Constantino CM
The "Diamond" pattern is very reliable and consists of four-sided price action.
It is also similar to adding two "triangle" patterns, Inverted and Symmetrical, together.
"Diamond" patterns are both continuation and reversal patterns.
If the pattern occurs in the midst of a trend, it will present a continuation of the trend in the same direction prior to the formation.
If the pattern occurs at the tops or bottoms, it will be a reversal pattern. Diamond "tops" form more often than Diamond "bottoms."
Trade: In "Diamond" patterns, continuous patterns form more often than reversal formations.
In a continuation pattern, wait for a breakout of the "Diamond" pattern and trade in the direction of the trend prior to the pattern formation.
In reversal formations, trade in the opposite direction of the prior trend. Confirm breakouts and breakdowns by price-action.
Target: Continuation "Diamond" patterns provide excellent target criteria.
The prior range before "Diamond" formation is the target from the breakout or breakdown level.
In reversal formations, prior major swing highsllows are set as the targets.
Stop: Place a "stop" order above the high of the " Diamond pattern for a short-trade and below the low of the " Diamond for a long-trade.
price is trading below the breakout level 0.89755 and has target the 61%bc 0.89143
at this point price could retest the breakout level and resume it downtrend to 100%.088770
by Constantino CM
The "Diamond" pattern is very reliable and consists of four-sided price action.
It is also similar to adding two "triangle" patterns, Inverted and Symmetrical, together.
"Diamond" patterns are both continuation and reversal patterns.
If the pattern occurs in the midst of a trend, it will present a continuation of the trend in the same direction prior to the formation.
If the pattern occurs at the tops or bottoms, it will be a reversal pattern. Diamond "tops" form more often than Diamond "bottoms."
Trade: In "Diamond" patterns, continuous patterns form more often than reversal formations.
In a continuation pattern, wait for a breakout of the "Diamond" pattern and trade in the direction of the trend prior to the pattern formation.
In reversal formations, trade in the opposite direction of the prior trend. Confirm breakouts and breakdowns by price-action.
Target: Continuation "Diamond" patterns provide excellent target criteria.
The prior range before "Diamond" formation is the target from the breakout or breakdown level.
In reversal formations, prior major swing highsllows are set as the targets.
Stop: Place a "stop" order above the high of the " Diamond pattern for a short-trade and below the low of the " Diamond for a long-trade.
Note
retracement to 78@ forming an abc price should resume downtrend any time at this price 0.89981
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