I have drawn a Gann Box around the most recent British Pound/US Dollar currency pair on a daily chart. A good portion of the price action lives in the botton red triangle area of the box. I will call this area the Bermuda Triagle. When a security is trading in this area of the box it can be said that the security is in a weaker position.
There is a Advanced GET Stochastic sell shaping up on the daily chart. Once the stochastic becomes overbought and should the price action find weakness at my down 1 x 1 Angle (perhaps at the 1.985 price), I might be interested in looking for a way to get triggered short.
(click on chart for full view)
On the chart below, I have applied the Time & Price Tool. If you count trading days from the high, we get perfect turning points on days 36, 45, 72 & 90. Day 135 missed the low by two trading days. I also used Fibonacci number for Price Factors. The increment of 8 units of price squared out perfectly with the 90 day turning point. Hence, as WD Gann often said when Time and Price Square - a change in trend is emient. The price increment of 13 units is pretty much at the forementioned 1.985 level (the midpoint of the ellipse tool). So if we consolidate over the next few days and run into 144 trading days from the high, that could very well be another perfect square out that meets resistance at my down 1 x 1 angle.
(click on chart for full view)
The next window of opportunity is most likley between 144 and 162 trading days from high.
Trade Well,
Ernest O.
Comments