XAG/USD: Silver reaction higher from equal legs area
|In this article we will analyze how XAGUSD (Silver), reacted higher from equal legs area. With the cycle from 02.02.2023 decline in Silver having a clear connector we were able to project the area in which we were expecting a reaction to take place. Here at Elliott Wave Forecast, we call these areas, equal legs or blue boxes. As you may seen within our charts. These are extreme areas in which buyers and sellers fight and agree into a reaction. One of the 2 sides should win and take control over the next move and cycle.
In the case of Silver it reached equal legs area between wave (A) and (B) of (C) to end 5 waves decline and the reaction higher took place. Let’s have a look on how we saw it during the 4 hour update from 03.08.2023
XAG/USD 4 hour update 03.08.2023
As seen it had reached blue box area between 19.979 – 18.392 area. We like to enter trades at blue boxes and equal legs areas as we get an 85% chance of a minimum 3 waves reaction higher at least. Then we create a risk free position even if the structure may change. From 19.883 it has reacted impulsively higher within wave 1 in which we were expecting to be ending soon higher. Followed then by a 3 waves pullback in wave 2.
Fast forward let’s see how it had developed from this weekend’s 4 hour update.
XAG/USD 4 hour update 03.18.2023
As we can see it had ended wave 1 and pulled back in wave 2 in 3 waves and already reacting higher within wave ((i)) of 3. The degree changed in this case as we are calling wave (2) ended, but overall is the same idea that ended wave 2 from the blue box/equal legs area. It will be very interesting to see the extend in which Silver can accelerate higher as usually wave 3s can be the most powerful wave within a cycle.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.