If there is one Elliott wave sequence of patterns to get excited about trading, it’s a triangle followed by an ending diagonal (W4 and W5 or B and C), not just because it give us a chance to trade wave3 and 5 of the diagonal safely, but also because this sequence usually considered a strong indication of a new trend in the opposite direction is most likely at the end of wave 5 of the diagonal, usually, It’s where a majority of traders, who were on one side of the market, decide to reverse their positions.
The pair completed a triangle (wave iv (blue)) on the 30th. Of Aug. @ 0.65222, 15 pips shy of 32.8% of wave iii. This was followed by a zigzag ending slightly beyond the extreme of wave iii plotting a new lower low before it retraced last week to test the mid 0.64000
The 2nd zigzag after a triangle is known as the “point of structure confirmation”
Now it’s IMPORTANT to remember that trading EW means trading possibilities, this is one legitimate scenario among others.
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.