Fibo 78.6% retracement level resists upward price action
Going back two years before, we saw the 1050-1370 rally in 2016 which retraced back to 1120 (Fibo 78.6% level) and bounced back upwards. Further, considering the 1370-1120 downward leg, Fib 78.6% level corresponds to 1320_ (where we are now). This level is serving as resistance.
If 1320-1325 band is broken, this will cancel the Fib retracement effect of 1370-1120 fall.
In case the price takes a strong downward reaction from here, I take the formation as a long term "symmetrical converging triangle limited by Fib 78.6%".
If 1320-1325 band is broken, this will cancel the Fib retracement effect of 1370-1120 fall.
In case the price takes a strong downward reaction from here, I take the formation as a long term "symmetrical converging triangle limited by Fib 78.6%".
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