040320-090320 EURGBP LOSS

Pattern Formation

This is a composite formation. Though I should have started the sell order at least in a staggered manner after the reach of the second pattern, because it had broken the trend line too, I waited for the resistance of the 1st formation to be broken, in order to put a sell order. More on that when I analyse the second pattern in the end of this post.

Trade

As you can see, I took the second pattern for trade confirmation as well as fibo levels. The trend couldn't sustain, after the 161 level was met. And it failed consequently.

1st Pattern Analysis

Obviously in the hindsight, the second pattern should have taken for confirmation as well as the Fibo levels. This was especially true due to Corona pandemic volatility, where sustaining a trend would not have been feasible. Also since profit margins are to be kept constant, the small movement envisaged by the second pattern would have yielded the same profit, as the profit from the 1st pattern trade had it been successful.