Third Wedge Push Up Might End Bullish Trend Channel
There are two different ways to trade this market based on my analysis.
You can wait until the market reaches the low of the channel and go long.
Make sure to wait for confirmation and a strong reversal!
The alternative would be to wait for a third major bullish push so that you can trade the move down from the wedge.
Since the bullish trend in the yellow channel isn't strong, a complete major trend reversal down to the last major low is likely.
If you wait for the market to move up again and create a wedge pattern, you can go short. The risk would be small compared to the big win you would get if you would leave the trade open until the market moves back to the old low. Of course, the probability of such a trade against the trend is not that big, but the good risk-reward ratio offsets this.
If you wait for a strong reversal on top of the channel, the probability will increase.
You can wait until the market reaches the low of the channel and go long.
Make sure to wait for confirmation and a strong reversal!
The alternative would be to wait for a third major bullish push so that you can trade the move down from the wedge.
Since the bullish trend in the yellow channel isn't strong, a complete major trend reversal down to the last major low is likely.
If you wait for the market to move up again and create a wedge pattern, you can go short. The risk would be small compared to the big win you would get if you would leave the trade open until the market moves back to the old low. Of course, the probability of such a trade against the trend is not that big, but the good risk-reward ratio offsets this.
If you wait for a strong reversal on top of the channel, the probability will increase.
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