Halfway Between Big Figures: Up or Down

Halfway between Big Figures: Up or Down

The big figure is of interest in deciphering charting patterns. However halfway between the big figure (50) is also of significant interest. If one assumes that the functionality of the big figure plays a role in shaping patterns around it, then one can expect that this can be the case for halfway as well, but perhaps in a different way. This is because halfway is not an end or a beginning, like the big figure itself, it is rather an intermediate point. It can be noted in Forex trends that even very strong moves will encounter resistance around the big figure, which can be quite extended: that is it changes the shape and directionality of the move.

Given a potential asymmetry in the Forex market between up and down moves (contingent perhaps on differing expectations of a rise and a drop, or the way moves can be built) then it may be expected that different patterns play out depending on whether the pair is coming up to the big figure or coming down to it. Going up it may be noted that coming up to the big figure, the pair may be expected to pause. However it still has all the valuation between it and the big figure above as potential. Thus there can be implicit momentum to carry it over 50. This is a case where the idea that market moves are based on future expectations is evident, more than it may usually be.

Each move contains a kind of optimisation on what is possible for the pair (this is not necessarily what determines the outcome though). The 50 provides a certain clarity which may not always be there, as future potential is wrapped up in complex patterns playing out. For this reason, the 50 seems to evidence a certain reliability in its effect, which is more simplified than the actual big figure. But of course what actually happens in unpredictable, as the potential for a Forex pair to change direction is there, so a stalling may turn into a reverse.

Coming down, the 50 can play a role in retraced patterns which failed to go far above the big figure, but which are still in fact moving up. This points to the way the direction a pair can be hidden in patterns: that is that directionality in Forex pairs can be complex, but nonetheless clear. This is part of the nature of Forex trading, that the desired direction may in fact happen, after sometimes deep retracements. But it can be seen why this is the case: the capacity to find a future valuation is perhaps more accurately based on a potential to move up or down, and patterns reflect this.

Search this site