The past week was exciting for traders especially on Wednesday, the daily range went over 120 pips. Thursday the rally up continued from 1 am to 5 am South African time. Instead of a weak slow pullback trend it went strong resulting Thursday to close a bearish day. Friday was trading range price action rejecting prices lower than 0.79365 and prices higher than 0.80071.
I use a method called multiple time frame analysis. 3 minute time frame for trading, 1 minute time frame for fine tuned analysis, 1 hour time frame for market structure.
The first step is finding the structure, in the screen shot above it is highlighted by the shaded a area. The second step is to identify the trend. On the market opened continuing Fridays trading range. At 01:55 am the market broke bearish, the down swing ended at 03:00am. A sharp swing back to the trading range began at 03:05 am. The upswing failed at 04:20 with a spike confirming a trading range market. The third step is to identify strength and weakness strength and weakness.
The up swing are currently showing weakness making it difficult for the bulls to make money. The top of the trading range is highlighted with a red line. High probability set ups in a trading range occur in a test of the range boundaries or a break out failure.
Caution to entries in the middle of the range. A bear day confirms when price action breaks below the low of the day. The trading time frame trend is currently bearish, whole sale prices are found in pull backs. Happy trading.
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