Hang Seng---All of the recovery?Hello Traders,
today I`d like to show you, Hang Seng, on a short term basis. I have spotted the 20 min chart, `cause HS shows at this timeframe the clearest pattern to my view. Hopefully, all of you can follow this timeframe. If not, let me know, I will use a higher timeframe than.
On Thursday 19, Hang Seng made a low @ 21139 and pushed to the upside. This move is to my view a „three-up, implies a countertrend attack that develops as an a-b-c-pattern.
Wave ((c))of the pattern achieved to a 1.382 Extension of wave ((a)) and is showing a bit „weakness“ since then.
Note, the similarity of the latter two chart patterns (highlighted with the two brown rectangles)! Both are exactly at the same length as the one before and shows the same internal structure. It could be, that HS has finished it`s countertrend at Friday @ 23791 and reversed to the downside or it needs some more up-down divisions to complete the structure. After, a decline to fresh new lows below 21139 should be next!
But one more fact is to try using gap-analysis.
I have, once again, highlighted the zone with the two gaps (purple rectangles) to the upside. Both are equal. If HS will achieve to the 23843.8 area, what plays the idea of one more up-down division perfect, than, if so to occur, HS is ready to decline to fresh new lows.
If so to com? We `ll see.
As you know, we have four types of gaps. The common-gap, which occurs most often during sideways markets, the Breakaway-gap, that tends to occur at the breakout of wave „3“, the Acceleration-gap, what occurs during at or near the midpoint of the move, and we have the Exhausting-gap, what finished the move. A close of this gap indicates, that the advance (in this case) is over!
One more important fact is, that a countertrend within a wave „4“ occasionally rare retrace more than a 0.5 Fibonacci of wave „3“! So any move, and close above the 23963.9 would alter the chart count and makes a wave „4“ less probably.
Have a safe and great weekend....
ruebennase
Feel free to ask or comment.
Trading this analysis is at your own risk!
