this is my most favorite EW pattern
it is called Ending Diagonal
it appears at the very end before trend reversal
it consists of 5 waves down (white labels) but each of waves
are not regular 5-wave sequences but 3-wave ABC structures
zigzags of red and green colours show it
wave 1 is usually the largest - it is in the chart
wave 3 should not be the shortest - and it is not in the chart
wave 5 is the smallest and sometimes overshoots the trendline support like we see
in the chart
How to trade it?
Signals
watch RSI making a Bullish Divergence
for the initial signal, watch how first bullish impulse breaks up the peak of wave 4
then wait for retracement, which should stay above the valley of wave 5
Trigger
the final trigger is set at the peak of that first impulse which crossed over the top of wave 4
when the price surpasses it after retracement it is good to buy
Reward and Risk
target is set at the start of the Ending Diagonal (it's the peak of wave 4 of higher degree)
stop should be put a the bottom of retracement preceding the trigger
it is called Ending Diagonal
it appears at the very end before trend reversal
it consists of 5 waves down (white labels) but each of waves
are not regular 5-wave sequences but 3-wave ABC structures
zigzags of red and green colours show it
wave 1 is usually the largest - it is in the chart
wave 3 should not be the shortest - and it is not in the chart
wave 5 is the smallest and sometimes overshoots the trendline support like we see
in the chart
How to trade it?
Signals
watch RSI making a Bullish Divergence
for the initial signal, watch how first bullish impulse breaks up the peak of wave 4
then wait for retracement, which should stay above the valley of wave 5
Trigger
the final trigger is set at the peak of that first impulse which crossed over the top of wave 4
when the price surpasses it after retracement it is good to buy
Reward and Risk
target is set at the start of the Ending Diagonal (it's the peak of wave 4 of higher degree)
stop should be put a the bottom of retracement preceding the trigger
Clause de non-responsabilité
Les informations et publications ne sont pas destinées à être, et ne constituent pas, des conseils ou recommandations financiers, d'investissement, de trading ou autres fournis ou approuvés par TradingView. Pour en savoir plus, consultez les Conditions d'utilisation.
Clause de non-responsabilité
Les informations et publications ne sont pas destinées à être, et ne constituent pas, des conseils ou recommandations financiers, d'investissement, de trading ou autres fournis ou approuvés par TradingView. Pour en savoir plus, consultez les Conditions d'utilisation.