First, we saw prices break down and close below the 10 and 20 DMA on Tuesday with a bearish candle. It looked as though the H&S pattern was in trouble and prices were going to try and test recent lows. However, on Thursday following the BOE meeting we saw prices bounce off their lows, rally, and close near their highs creating a very bullish candle. This brought us back above the 10 and 20 DMA along with creating a potential ABCD pattern.
Second, Friday's price action indeed confirmed an ABCD pattern with neutral retracement and a very bullish 7:1 right hand skew on the breakout. The skewing confirms bullish momentum as it took 7 bars from it's swing high to swing low and only one bar to break out and create the ABCD pattern. This changes some of the upside price targets.
Third, we got a close above the 50 DMA for the first time since January 10th and closed right on the 10 WMA.
Finally, some upside price targets:
Conservative: the 100% projection of the ABCD pattern ~ 1.5464
Moderate: the H&S objective ~ 1.5545 alongside the 100 DMA ~ 1.5531 and 20 WMA ~ 1.5521
Aggressive: the 261% extension of the ABCD pattern ~ 1.5637
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