First take a look at higher time frame.
On H4 we see wave 1 and wave 2 look completed.Next two waves, 1 and 2 looks completed as well,
If it is so, right now we are in wave 1 of wave 3 progression, with the recent long awaited breakout from small wave 4 correction.
Normally I would say – this is bullish as hell from Elliott Wave perspective. The thing that bothers me is lack of momentum and MACD Histogram with standard settings is diverging from the price, showing classical wave 3 & wave 5 bearish divergence.
So I’ve made an alternative count that shows this entire move with wave labels. Both of the counts shows correction time – main count calls for not deep correction as we are in the bullish wave 3 cycle and alternative count calls for deeper pullback as big wave 2 correction is comming.
What’s the best for a trader from that situation overview?
Well, we want to BUY the correction at certain levels to RIDE THE WAVE 3. We do not want to trade the correction that is full of whipsaws.
Main Count Levels on chart. TIGHT STOPS!
Alt. Count Levels are the previous wave 4 area and untested area just below.