The decline from the $22.20 highs appears to be corrective, so as long as we remain above $20.50-60 zone then bullish targets remain $22.20 and $23.00.
Attempting to pick the bottom of a correction can become frustrating as it whips you into a profitable trade for a few ticks, and only to see it drop a little lower. This is why multiple confluences of support or resistance paramount in such circumstances to help define a more likely turning point before the anticipated trend resumes.
We are now holding above the $20.50-60 zone, and Monday’s low tested this area to produce a Doji (and hesitancy to go lower). This zone also coincides with a 50% retracement (my favoured ratio as generally more reliable), and yesterday produced a Rikshaw Man Doji with a higher upper wick to show the sentiment from the previous decline is waning and suggests there are buyers down around $20.50 and above.
Of course nothing in this game is guaranteed, but I do like the confluences of support highlighted to assume a trend continuation soon.
However, in the event we do break below this area then we have a 2nd zone of support between $20-$20.20. This really depends on your own trading style but I am not a fan of trading from the 61.8% as I prefer to see shallower pullbacks in line with an impulsive move. I find deeper pullbacks tend to entice choppier and more confusing corrections - my opinion only of course.
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