February Real Estate of the Month Trade Setup Idea
|This month's ProAct Traders “Real estate of the month” (formerly the pay your mortgage trade) idea is found in the EURUSD pair.
02/12/18 1.2364 start
We are waiting for a reaction and turn @ 1.2364. This turns the bias now to the downside and a continuation of the trend in a 3rd wave. CAUTION: the former count may only be a 3 wave which means that if we blow out the top here it is most likely the continuation of a 5th wave which would negate this opportunity. There are always 2 or more alternative counts in Elliott Wave.
Wave 1 was 314 pips so to equal that and then extend we have arbitrarily put a 350 pips target for wave 3 which takes us to the 0.618 Fibo @ 1.2008. We are looking for an initial move to the 0.618 Fibo @ 1.2008 and then a 4th wave move back to the 0.618 Fibo @ 1.2161. Our overall target is the 1.270 Fibo extension @ 1.1800. There are 6 large Wide Open Space’s (WOS) here – Don’t Miss those BIG Opportunities! Any pullback offers increased opportunity to add positions. Total move would be 350 for wave 3 and 319 Pips for wave 5 not counting pullbacks.
How to trade it? You will need to wait for your set-up to show up, for London & New York traders, that will mean waiting for the reaction now in the current area or up at 0.382-0.500 Fibo (1.6629-1.6777). Take your first entry and use the respective risk reward ratio to start trading this currency pair. We have preplaced entry orders (sell stops) on the break of each Fib and barrier to the downside and any rally should be considered an area to add to the position. DO NOT TRY AND CROWD THIS PAIR WITH TIGHT STOPS. Remember the “pullback is your friend” in route so use those to add to the position.
The pair typically has pullbacks in the 160 pips range, so every pullback could add an additional 150 pips to the trade with another position. Manage that Pullback by removing all but the FIRST TRADE. Currently the ATR (14 Day - Average True Range) of the currency is 111 Pips per day (which is higher than its 180 day average of 83), so this might take about 2 weeks with pullbacks!
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