Butterfly Sell chart pattern - best forex trading signals provider

Butterfly Sell chart pattern ~ best forex trading signals provider

Butterfly Sell price target

EUR/USD Technical Chart Analysis

On Friday, we had a perfect butterfly sell chart pattern. Today, the Euro initially went down (Evening Star chart pattern from Friday) and found support at the 61.80 %  fib retracement (1.2889) and resistance at the hourly trend line (blue).

1 hour Butterfly sell pattern

Typical Consolidation Pattern

On the 5 min EURUSD Chart below another typical three swing consolidation pattern is visible just at the daily Pivot Point support. The breakout of the consolidation pattern occurred with the start of the new hourly candle at 12. a.m. (Important Timing Point). The up move of the Euro found resistance at the hourly downward sloping trend line.


Interestingly, the consolidation pattern and the false breakout to the 161 % Fibonacci level at 1.2979 is very similar to the butterfly sell chart pattern. After the false price breakout to the upside to the major 161 % butterfly sell target market reversed and retraced the up move. The Euro targeted the final 161 % butterfly sell target at 1.2940, where the EURUSD paused a while before market continued the downward move to the weekly Pivot Point. The weekly Pivot provided solid support (together with the 100 % Fibonacci Extension level of the recent swing at 1.2932) and the Euro bounced back up to the daily Pivot Point.

Overall, the daily Pivot Point provided solid support at 11 a.m.. After the confirmed break of the daily Pivot to the downside at around 3 p.m. the daily Pivot changed its role from support to resistance as often after a confirmed break of important chart levels.

5 min EURUSD Analysis

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Fibonacci levels and Bear Flags - best forex trading signals service

Fibonacci levels and Bear Flags ~ best forex trading signals service

Fibonacci extension levels

Flag patterns

The EUR/USD Chart Analysis

shows the importance of the 61.80 % and 100 % Fibonacci extension levels, which market often respects as support/ resistance, at least temporarily. On the hourly Euro Chart we see that market respected the 61.80 % Fibonacci Extension level at 8 a.m..Market retraced up from this Fibonacci Extension level to the downward sloping 20 SMA (purple line) and the 61.80 % Fibonacci retracement level. From this resistance level, which market approached at 1 p.m., the EUR/USD rolled over and continued its downward trend to the 100 % Fibonacci Extension level. The 61.80 % Fibonacci Extension level often provides only temporary support/ resistance. The 100 % Fibonacci Extension support level got further strengthened due to the weekly S1 at 1.2859.

1 hour Fibonacci extension levels

On the 5 min Chart we see that the EUR/USD consolidated at the uprising trend line and the daily S1, formed a bear flag (Continuation pattern) and market finally broke through the support level of the uprising trend line. Market took out the stops and triggered the limit breakout orders below the recent low (left side of the 5 min chart) and the Euro started to retrace back into the Consolidation zone (Market Price Manipulation) of the prior bear flag, which now acts as resistance (Consolidation price zones). Furthermore, the daily S1 changed its role from support to resistance after the confirmed break of this level on the 5 min chart.

5 min EUR/USD Chart Analysis

Another EUR/USD Chart Analysis in regards of Fibonacci Extension levels and Bear flag pattern:

4 hour Fibonacci Extension

Fibonacci and Bear Flag

continued its down trend today with the triggering of the bear flag pattern. The 10 SMA on the 4 hour chart provided resistance to the Euro and the  EURUSD depreciated further. The Euro found support at the daily S1 and 61.80 % Fibonacci extension (1 hour chart) and market turned around after the creation of the hammer candlestick pattern on the 5 min chart. The EUR/USD moved up to the prior consolidation price zone (bear flag - hourly chart-orange arrow), which acted as resistance.

1 hour Bear Flag pattern, Hammer

5 min Hammer pattern

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Butterfly pattern and price targets - barclays forex trading signals

Butterfly pattern and price targets ~ barclays forex trading signals

Butterfly Sell pattern

Weekly and Daily Pivot

The Euro

formed a butterfly sell pattern on the 5 min chart. The turn around at the 127 % butterfly sell target coincided with the 61.80 % fib retracement on the hourly chart and the weekly R1. We also see the importance of pivot points for example of the weekly and daily pivot and daily S1 and weekly R1.

Market initially moved down at 8 a.m. to find support at the weekly Pivot Point. From the weekly Pivot the Euro bounced up strongly, creating a small bull flag at around 8:45 a.m.and later the Butterfly sell pattern. 

The Butterfly pattern is a typical reversal chart pattern so that market typical retraces the preceding move after the failed breakout to the 127 % or 161 % Fibonacci extension level from the preceding Consolidation pattern at 10 a.m.. The Euro retraced back to the typical 161 % Butterfly price target, which also coincided with the 61.80 % Fibonacci retracement level of the recent swing up at around 1 p.m.at 1.29. 

The Euro consolidated above the 1.29 price level with the typical three swing consolidation before breaking temporarily through the 1.29 level (psychological level). Later in the US session the Euro has been in a choppy trading environment with the daily Pivot as the upper border and the 1.29 price level as the lower border.

5 min Butterfly Sell Pattern, Butterfly Price Target

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Butterfly price targets - best forex trading signals free

Butterfly price targets ~ best forex trading signals free

Trading the Butterfly pattern

A Butterfly chart pattern was in todays Forex trading session in the EUR/USD on the 5 min chart (last chart).

The Euro found resistance at the 127 % butterfly sell target (5 min chart) and from there the EUR/USD went straight to the 161 % butterfly pattern target. The consolidation price zone of the triangle pattern (hourly chart) and the hourly 200 SMA also gave some support at the 161 % butterfly pattern target at around 1.2940.

On the 4-hour chart we see an Evening Star pattern.

4 hour Evening Star pattern

1 hour triangle breakout

5 min butterfly sell pattern

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Fibonacci and Pivot Analysis - forex black box trading signals

Fibonacci and Pivot Analysis ~ forex black box trading signals

Consolidation and Continuation Chart pattern

Fibonacci Retracement and Extension

The two green ellipses are consolidation pattern, which acted as continuation chart patterns - Flag and pennants. The consolidation price zone of the first Consolidation/ Continuation Chart pattern (green circle) acted as support as market price tested this price zone of 1.2460 again. This support zone got strengthened through the 61.80 % Fibonacci Extension level of the recent swing and the 61.80 % Fibonacci retracement level.

The Euro moved up to the price zone of the black circled Consolidation pattern, which looks similar to a small Head and Shoulders pattern (H&S). As often, the first retrace into a price zone of a prior consolidation held the first test and the EUR/USD moved strongly down again to the daily support level (pink line). The Euro consolidated for a while after hitting the daily support before the second strong leg down moved price to the Daily Pivot Support. From there, the EUR/USD bounced strongly up above the recent daily high to clear some stops and fool some breakout trader.

The failed first breakout often occurs due clear the stops and fool some breakout traders at striking chart levels like market highs and lows. This manipulative triggering of market orders is also visible on the further price action on the chart, whereby the weekly R2 held the market drop in the beginning of the US trading session.

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5 min EURO USD Pivot Points and Fibonacci

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Butterfly buy pattern - bk forex trading signals

Butterfly buy pattern ~ bk forex trading signals

Fibonacci Price Targets

161 % Fibonacci Extension target and 61.80 % Fibonacci Retracement

Butterfly Buy Pattern on 5 min chart.

On the 4 hour chart of the EUR/USD we see that market price found support at the 61.80 % Fibonacci retracement and the daily S1 Pivot. From there, the Euro moved up to the 4-hour 10 Simple Moving Average (SMA) and the daily and weekly Pivot point resistance, where price started to slightly retrace back.

4-hour Fibonacci  Retracement

The 5 min Euro Chart below shows the development of a Butterfly buy chart pattern, which led to the sharp price reversal visible on the 4-hour chart.

The large black circle shows the butterfly pattern -three wave consolidation-after an impulsive move. The Euro passed the minor/ first butterfly buy target at 127 % Fibonacci Extension of the consolidation pattern and market price moved further to the final 161 % Fibonacci level of the Butterfly buy pattern. From there, the Euro reversed sharply to the upside and market reached the 161 % Fibonacci Extension of the whole swing from the high of the consolidation pattern/ Butterfly pattern to the market low.

In addition, the 161 % Fibonacci Extension level at the market bottom, which usually acts as the buying opportunity in the butterfly buy chart pattern, also coincided with the 100 % Fibonacci Extension level (of the recent swing down prior to the consolidation pattern moved to the high of the consolidation pattern).

Furthermore, the final 161 % Butterfly target coincides with the weekly Pivot point. The daily Pivot point might have acted as further resistance zone.

5 min Butterfly buy pattern

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