Our winning patterns for week ending 2020-11-13
EURUSD Bearish Flag on the 1H chart. This is a beautiful example of how great trading tools can help recognize correct pattern. Flag is simple but easy to miss price formation. If you using only price action strategy, then you will definitely lack confidence when spotting such a pattern as a flag. In order to make a correct judgment you need to know that market trend only pausing and soon will continue moving in chosen direction. Temporary stop is a place to open position which can be very profitable. Here we see pattern on the chart and thanks to S-V3 we can confirm that this is 100% flag. Watching video below you can see how spread apart are lines of S-V3 indicator. This is a powerful signal which tells us that lower timeframe is about to change while higher timeframe is still in downtrend. This is perfect confirmation to place a sell order. And we did.
USDCHF Bullish Flag on the 1H chart. Above we had bearish flag and here we can see bullish flag. It has same pattern characteristics but moves in the opposite direction. Notice how powerful move up preceding flag. It looks like a straight line – pole with a flag on the top. Then we are experiencing pause in price movement. Buyers are taking brake before next rally. This pause is a place for you to open buy position. S-V3 is a great friend in this situation as gives you clear confirmation – small line much lower than big line, and big line at the top of oscillator. With this in mind, you know you going with trend.
USDCAD Bearish Butterfly on the 1H chart. Harmonic patterns are hard to recognize due to their technicality. But worry not, as you don’t have to be professional harmonic pattern trader to profit from market conditions. If you have a closer look on to two images below, you will see that instead of bearish butterfly you can trade channel. Some traders like harmonic patterns because of their complexity. Nowadays you don’t have to know every price formation out there. Be smart and use proper applications. We don’t look for harmonic patterns because we use 3rd party application available to everyone, which scans market for correct price formations. Once we have pattern we check it against our S-V3 indicator. If everything is as should be, then we open position. Simple as that. No magic – just great trading tools. Let computer make hard work.