What is up my people? Have not published a trade idea for a while because the market has been mostly moving sideways since my last post and my last trade idea about a possible resolution to the downside still holds as much water as it did a week ago. However, recent developments give me a hint that we might have an explosive resolution of this insufferable macro triangle/ pendant formation.
Additionally, I want to bring you a bit more meat on the bone compared to other trade ideas that I have seen recently. You are in for a treat, If you like a deep dive into a price action & technical analysis.
Caveat: The sentiment is long but, this does not mean that we will not see some blood in the streets prior to the decisive move to the upside.
Contents:
- Moving Averages
- Price action
- Price channels and possible continuation
- MACD Cross on weekly
Here we go:
On 4 Hours we are under all major moving averages including And price action to the upside is governed by 21 EMA and 50 EMA which will most likely serve as resistance.
We are still under the death cross on 4H, which means that this territory comes with great buying opportunities for long term investors and with possible unpredictable moves in all directions for traders and scalpers. Keep your shorts tight and don’t buy into this BS DCA nonsense unless you are a swing trader or a long term investor. I also would like to note that the distance between blue 50 and green 200 SMA has been increasing, there is 50 and 377 SMA bearish cross fast approaching and all of the major (21+) moving averages are sloping downwards which means that there is still some more nastiness in store for us.
However! The direction of the price movement is not as unpredictable as it looks, and here is why:
- We are approaching the end of the price movement channel that has been governing the price action since August 4 and you can identify this channel with green dotted borders and red pointers.
- Given that we do not break out from the triangle formation we would need to find a pivot to a new price action channel start of which is marked with a green pointer.
- Red circles mark the areas of confluence and they have a gravitational effect on the price action however the price usually chooses to take the path of the least resistance. Least resistance = Channel governed with STRONG support and resistance borders.
- Possible support and resistance channels are charted, bolder lines indicate major S&R and lighter indicate neutral S&R.
- Unlikely, but still possible - we might pivot immediately to a new price channel marked with bold red dotted border and orange cross arrows.
On daily we have purple 100 and brown 377 EMAs fresh bullish cross, which resulted in explosive 500$ move to the upside, however this cross is not that significant from purely TA perspective, yet it could serve as an indication that bulls want to take control of the price action. Sadly, on 4 Hour we have the same SMAs trying to cross bearish which could result in the price action that can push us over the edge.
On daily the price action is supported by 100 EMA sitting at 9800, which means that as long as we don’t open or close a daily dildo under this level, the most probable breakout from the current formation will be resolved to the upside, on the contrary, opening and closing daily price action under 100 EMA will result in early resolution of the formation to the downside and will have a waterfall effect to 9.4K, 9.1K, 8.8K and 8.5K levels.
In order to get this situation (macro consolidation) resolved to the upside, bulls need to reclaim 50 EMA (@10450 $) on daily and open and close the price action above it. Which in my opinion will create a massively bullish sentiment.
Oh one more thing: MACD on weekly just has crossed bearish. This indicator has not been great or massively helpful on high timeframes, however, in the previous situations the resolution of the MACD cross has been following:
- In bearish markets, like January 2018 it has signalled possible capitulation as was followed by 50% selloff
- In bullish trending markets, it usually signalled that the resolution of ongoing consolidation was near. This is usually followed by 5-15% drop from the current price action and a price level achieved as a result is this drop will be a new low that we will not revisit anytime soon.
Hope this is helpful to you are enjoying this detailed analysis provided by me and if you wish to have more of it, please subscribe and give an idea a like so I will now that you fancy when I deep dive into this market.
Cheers
Archie
Additionally, I want to bring you a bit more meat on the bone compared to other trade ideas that I have seen recently. You are in for a treat, If you like a deep dive into a price action & technical analysis.
Caveat: The sentiment is long but, this does not mean that we will not see some blood in the streets prior to the decisive move to the upside.
Contents:
- Moving Averages
- Price action
- Price channels and possible continuation
- MACD Cross on weekly
Here we go:
On 4 Hours we are under all major moving averages including And price action to the upside is governed by 21 EMA and 50 EMA which will most likely serve as resistance.
We are still under the death cross on 4H, which means that this territory comes with great buying opportunities for long term investors and with possible unpredictable moves in all directions for traders and scalpers. Keep your shorts tight and don’t buy into this BS DCA nonsense unless you are a swing trader or a long term investor. I also would like to note that the distance between blue 50 and green 200 SMA has been increasing, there is 50 and 377 SMA bearish cross fast approaching and all of the major (21+) moving averages are sloping downwards which means that there is still some more nastiness in store for us.
However! The direction of the price movement is not as unpredictable as it looks, and here is why:
- We are approaching the end of the price movement channel that has been governing the price action since August 4 and you can identify this channel with green dotted borders and red pointers.
- Given that we do not break out from the triangle formation we would need to find a pivot to a new price action channel start of which is marked with a green pointer.
- Red circles mark the areas of confluence and they have a gravitational effect on the price action however the price usually chooses to take the path of the least resistance. Least resistance = Channel governed with STRONG support and resistance borders.
- Possible support and resistance channels are charted, bolder lines indicate major S&R and lighter indicate neutral S&R.
- Unlikely, but still possible - we might pivot immediately to a new price channel marked with bold red dotted border and orange cross arrows.
On daily we have purple 100 and brown 377 EMAs fresh bullish cross, which resulted in explosive 500$ move to the upside, however this cross is not that significant from purely TA perspective, yet it could serve as an indication that bulls want to take control of the price action. Sadly, on 4 Hour we have the same SMAs trying to cross bearish which could result in the price action that can push us over the edge.
On daily the price action is supported by 100 EMA sitting at 9800, which means that as long as we don’t open or close a daily dildo under this level, the most probable breakout from the current formation will be resolved to the upside, on the contrary, opening and closing daily price action under 100 EMA will result in early resolution of the formation to the downside and will have a waterfall effect to 9.4K, 9.1K, 8.8K and 8.5K levels.
In order to get this situation (macro consolidation) resolved to the upside, bulls need to reclaim 50 EMA (@10450 $) on daily and open and close the price action above it. Which in my opinion will create a massively bullish sentiment.
Oh one more thing: MACD on weekly just has crossed bearish. This indicator has not been great or massively helpful on high timeframes, however, in the previous situations the resolution of the MACD cross has been following:
- In bearish markets, like January 2018 it has signalled possible capitulation as was followed by 50% selloff
- In bullish trending markets, it usually signalled that the resolution of ongoing consolidation was near. This is usually followed by 5-15% drop from the current price action and a price level achieved as a result is this drop will be a new low that we will not revisit anytime soon.
Hope this is helpful to you are enjoying this detailed analysis provided by me and if you wish to have more of it, please subscribe and give an idea a like so I will now that you fancy when I deep dive into this market.
Cheers
Archie
