Hello Traders, in this article we will analyze how XAGUSD (Silver), reacted higher from equal legs area. With the cycle from 02.02.2023 decline in Silver having a clear connector we were able to project the area in which we were expecting a reaction to take place. Here at Elliott Wave Forecast, we call these areas, equal legs or blue boxes. As you may seen within our charts. These are extreme areas in which buyers and sellers fight and agree into a reaction. One of the 2 sides should win and take control over the next move and cycle.
In the case of Silver it reached equal legs area between wave (A) and (B) of (C) to end 5 waves decline and the reaction higher took place. Let’s have a look on how we saw it during the 4 hour update from 03.08.2023
XAGUSD 4 Hour update 03.08.2023
As seen it had reached blue box area between 19.979 – 18.392 area. We like to enter trades at blue boxes and equal legs areas as we get an 85% chance of a minimum 3 waves reaction higher at least. Then we create a risk free position even if the structure may change. From 19.883 it has reacted impulsively higher within wave 1 in which we were expecting to be ending soon higher. Followed then by a 3 waves pullback in wave 2.
Fast forward let’s see how it had developed from this weekend’s 4 hour update.
XAGUSD 4 Hour update 03.18.2023
As we can see it had ended wave 1 and pulled back in wave 2 in 3 waves and already reacting higher within wave ((i)) of 3. The degree changed in this case as we are calling wave (2) ended, but overall is the same idea that ended wave 2 from the blue box/equal legs area. It will be very interesting to see the extend in which Silver can accelerate higher as usually wave 3s can be the most powerful wave within a cycle. You can learn what’s next for Silver and how we can see the bigger picture by joining us here at Elliott Wave Forecast. Consider to become a member and improve your trading/investing decisions.