Here i see a Cypher Pattern on the NZD/JPY chart. And what i noticed, if you zoom out; on the daily chart there appears to be a crab pattern that has rallied as if it going to complete as suggested, but this Cypher pattern has me thinking that the market will more likely continue in downtrend and break the structure of the crab pattern therefore ruining that trade. Now the cypher is still a safe trade if ,and only if, the market completes the Cypher then immediately reverses upon completion.
But in short, I've decided to short the Cypher trade for a lot less return, but its safer.
My entry is at the peak of the cypher pattern with stop around the highest high of the pattern, my limit can be debated, if we assume the market is going to continue in downtrend after breaking the structure of the crab pattern, you could move you limit to the next structure support level, but i always believe in consistency, so i have placed my limit at the 1.618 extension of the BC leg.
Please , if you agree, like comment and even follow !
As always good trading !
But in short, I've decided to short the Cypher trade for a lot less return, but its safer.
My entry is at the peak of the cypher pattern with stop around the highest high of the pattern, my limit can be debated, if we assume the market is going to continue in downtrend after breaking the structure of the crab pattern, you could move you limit to the next structure support level, but i always believe in consistency, so i have placed my limit at the 1.618 extension of the BC leg.
Please , if you agree, like comment and even follow !
As always good trading !