Analysis 19-12-26

This blog post explains V-Power entries within Golden Setups.

V-Power is a trading system with automation possibilities that gives you an edge over the market. To achieve a much higher winning percentage you can combine high probability setups with V-Power e.g. Golden Setups.

Here you can read everything about the V-Power system and download a free version: V-Power System Explanation + FREE Version

Here is a detailed explanation how you can get a huge edge over the market by using Golden Setups: Golden Setups explained

 

 

Possible Next Golden Setups at the moment

 

USDCAD

This week, we’re seeing another rejection of the bears at that major support área at 1.3112 on D1 time frame. This major support level acted as bearish correction during the bullish trend 30 days ago on November 5th (labeled with red circle). A bullish Pin Bar reversal formed six days ago on this same level 1.3112

 

 

Let’s look how the fibonacci retracement levels are considered a predictive technical indicator. These retracement levels attempt to identify where price may be in the future. I start with the Price distance of each wave. The price distance of each wave is measured as a vertical distance from beginning of wave to the end of the wave. I only consider 3 waves.

The following chart on D1 shows 3 waves, the Wave 1 starts at A and ends at B, the Wave 2 starts at B and ends at C and the Wave 3 starts at C and ends at D.

 

The most common Fibonacci ratios used in the stock markets are:

Multiples = 1 – 1.618 – 2.618 – 4.23 – 6.85

Ratios = 0.14 – 0.25 – 0.38 - 0.5 & 0.618

The major common retracement we may look for in a typical wave 2 pullback are a 50% or 62% retracement of wave 1.

In the D1 time frame we can see on USDCAD the 50%- 61.8% retrace levels of a major up move on November 5th these levels become a future reference area where the price can bounce (labeled with red box)

 

Note: Some statistical information behind wave 2’s while we are on the subject of wave 2’s.

  • It’s expect only 12% of wave 2's to hold 38% retracement of wave 1
  • We can anticipate 73% of wave 2 retracements between 50% to 60%
  • We can anticipate 15% of wave 2´s to retrace below the 62%

 

On H4 time frame we can see the price action on the support área 1.3114. Also the screenshot on H4 shows the actual situation where the price is reacting to 50%- 61.8% retrace levels (labeled with red box). Two bullish  divergence also formed to long term support level. 

 

Trade ideas: On the one hand, look for a pullback with a clear V- power Setup buy signal on H1 whilst price remains above the 1.3114 – 1.3101 support área- On the other hand, if we eventually break back below 1.3101 level, the door can re-open to significantly lower prices.

 Along these lines, we have SEVERAL things on USDCAD which maybe produces a V Power Setup:

  • Matured Upward Trend on D1
  • A major support price level @ 1.3114
  • A regular divergence on H4. Also we can look for on H1/M30
  • The price broke above downward steeper trendline

 

EURGBP

 

In the chart below (D1), the long term bias is strongly bearish (labeled with the red arrow); price is holding above the 0.8322 long term support area and could move back up towards recent highs at 0.8675, then short term resistance at 0.8791.

The 0.8322 support level is a strong technical support base has formed after prices held firmly during 4 times (labeled with black arrows)

 

 

If we zoom in the same time frame a steeper trend line has been break and the price remains above .8496 and .8327 support área. At the same time there are a bullish divergence and a nice V Pattern.

There's a chance of an AAA+ setup. This setup come within a new upward trend on D1. Therefore, wait the first box(es) of a new direction on the time frame D1 because is a good place for an early entry into the D1 trend.

On the 4 Hour chart formed a bullish divergence .8327 support área. Therefore we already have two divergences (D1/H4) and twos strong V formation (D1/H4).

 

Mike's recommendations, “If you want to stick to the original VPower rules 1:1 (which you should especially at the beginning) then you would need to wait until the first upward box will be drawn. Please remember that the first upward box is a full bodied red box until a new high is reached”

 

Within this new D1 up trend we will consider look for entries on H1 (according to the 5 rules) in direction of the D1 trend

To summarize,

  • Steep downward trend line = OK (during 47 days)
  • Matured DownWard Trend= OK (both downward moves penetrate the major support level 0.8322)
  • A major support price level on D1= OK (0.8322 level)
  • A regular divergence on D1/H4 = OK
  • Strong V-formation on D1/H4 = OK

 

 

Here you can read everything about the V-Power system and download a free version: V-Power System Explanation + FREE Version

By joining the V-Power community you will get access to a very active private telegram group with experienced members: Join the V-Power Community

 

 

About Me

I'm Mike Semlitsch the inventor of the PerfectTrendSystem. I'm in the trading business since 2007. Helping other traders to succeed in trading is my passion. The PerfectTrendSystem is the result of more than 30,000 hours of hard work. Connect With Me:  

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