WE MIGHT SEE $200 SOONLet's get a couple of things out of the way. First, I'm not a financial advisor and all of my comments are assumptions based on what I perceive as evidence from the chart. Secondly, my charts are usually all over the place and not pretty, that's because the market moves all over the place and I have to consider different scenarios. However, I do my best to give a good explanation to make it simple to understand.
My honest opinion on EGLDUSD trading pair at the moment is that I'm very bullish. Reason because;
1. If we go down from here is a scary drop, if the price moment fails to find support on any of the assumed support on the chart indicated by the lower green dash and the lower solid pink lines, the next possible support is at about $125, then $117, then $100. I believe that this type of drop only happens if the whole market is correcting or if there's negative news about the project both of which look unlikely at the time of writing.
2. As you can see from the chart we have clearly broken out of the channel that is shown by the dash yellow lines and we are yet to reach the price target for that breakout which is around $190 - $193 this gives me the confidence we are likely going up. The movement to that target might be slow but it's definitely a target we should reach except any of the aforementioned scenarios in the first reason becomes the case.
There are 2 possible routes the price movement might take on its way to ($190 - $193)
a. A rising wedge that is shown by the solid pink lines on the chart. If the price movement follows a rising wedge then we expect to see higher highs and higher lows until we breakout. A breakout in an upward direction from the rising wedge will take us to about ($240 - $260) a breakdown will take us around $135.
b. An ascending triangle that is shown by the dash green lines on the chart. You can see that the price has twice seen a rejection close to $170 and it has also made higher lows. If the price movement is going to follow an ascending triangle pattern I expect the solid pink support line to fail and the price to trade below $140 and find support on the lower dash greenline. I also expect lower highs. A breakout of this assumed triangle in an upward direction will take us to about ($220 - $222) a breakdown will take us around the support at $117.
Things I intend to do/Strategy on this trade.
1. Anywhere close to the support of the rising wedge is a good buy/ entry point.
2. take profit at around (190$ - $193). At that point if we are still trading in the wedge you might want to reenter a little bit below the middle of the wedge, if we are no longer trading in the wedge use auto fib extension to enter at the next support level below $190.
3. set stop loss at $123 in case we failed to hold at any of the 2 assumed support. If stop loss is executed set a buy order at around $117.3 if you wish to continue the trade.
4. take profit at ($240 - $260) or ($220 - $222) depend on which path the price movement follows
5. Set a price alert to stay up to date with these critical price points.
6. If the price continues to go up but did not follow any of these paths, still expect rejection at (190$ - $193) so take profit, you may reenter thereafter.
7. In any breakdown scenario the stop loss specified here is valid.
Comments are welcome.
Good luck with your trade!
