A lot has gone down this week.

The Forex market, over time, used to lose volatility. There were 6-months longs stetches when the market would not be able to get away from the 9-day EMA band (high to low) by more than 4 fluctuation maximums (38.4 pips for per flucutation maximum).

It was more common a decade ago to see 9, 10, 11x stretches. Now things seem to be trending up again.

This was your 8x stretch from the mean.

The market wants to mean-revert, particularly after a 2.5x stretch, but short-term, emotional buying can prevent it from doing so.

The second pump came from below the hourly 32 EMA as usual.

60 hours of celibacy

if (Low[i]<iMA(symbol,0,64,0,MODE_EMA,PRICE_MEDIAN,i)) P2[i]=1;
if (i>0 && (P2[i]==1) && P2[ArrayMaximum(P2,60,i+1)]==0)

Those wanting to fade the 1.20 break got systematically run over, and their holdings got taken over at a higher level (a new Scrape Level was made – and the mean reversion had started.

Now, pay attention to the Firebrick line.

ExtUpperBuffer_d[i]=iLow(symbol,0,iLowest(symbol,0,MODE_LOW,10,i+6))+820*Point;
ExtLowerBuffer_d[i]=iHigh(symbol,0,iHighest(symbol,0,MODE_HIGH,10,i+6))-820*Point;

Once you see a candle beyond this Firebrick line, add 14 pips to the previous candle, and then the next 2 candles would be falling shy of this new extreme by 34 pips, you have yourself a “sold into / bought into.” There is an escalated version of achieving 27 more pips beyond the Firebrick to receive a volatility boost (Luke, I’m your father). This would make the directional logic paint the opposite color instantly, versus neutral.

Now, momentum entries inside the wave structure.

///RSI2 FireBrick momentum sells 
 if (RSI2[i]<RSI2[i+1] && RSI2[i+1]>RSI2[i+2]  && RSI2[i+1]>95.5 && High[i+1]>iHigh(symbol,0,iHighest(symbol,0,MODE_HIGH,4,i+4))
 && MFI[i+1]<71 && High[i+1]-Low[i+1]>130*Point){

The pink “bought into” was lacking one thing. The extra 27 pips. The trade to the upside was good for 2 slim bricks and a get-out after the highest close.

So, momentum-sell, #2

Missing? Bought into. No undecut happening below the Firebrick by 14 pips just yet.

A buy into is likely not very far now that the price is back inside the Moat.

Whenever the moat is 27+ pips wide (42+ currently), it is highly likely to turn the price back around, as it won’t be able to cross with a single try. The moat is the shaded area between the 9-day EMA band and the 712 SMA (30 min).