In the previous idea I wrote that price was between two extremes, still is. In this idea I am going to show you some more interesting signs from other indicators, but remember to take any actions until the price go through one of the extremes might be dangerous.
//You should consider this idea as an extra to my two previous ones.
Let's start with Pivot Points. Pivot point indicator has a very simple calculation, it's just take the average between high, low and close of the previous period and put it forward. So we can see how price evolve relative to the previous period, in my case it is based on monthly period. What we currently see is that price is moving above the pivot point, which usually means ongoing bullish sentiment. But of course this case is a bit more complicated, because there are several strong resistances for the price on local levels (121 MA, $9.700 resistance, resistance zone (previous support zone for the descending triangle)) Currently the pivot point working as a support and might be a useful sign in case the price will save its position above this level, and also above the box, that Upward scenario will resume. Small remark - might be a useful sign, only if confirmed with other indicators (MFI, RSI, MAs).
Indicators:
MFI and RSI provide relatively the same information, but MFI (money flow index) use volumes for its calculations and this difference makes this indicator more sensitive and in some way faster to react on price movements. Pay attention on divergences on both of indicators MFI and RSI: MFI and RSI were charting higher lows in period when price was consolidating, but MFI had steeper trendline than RSI and its behavior was much clearer to understand the price was accumulating for the Upward movement. Also these indicators make me to think that the price is accumulating for the trend resumption, because RSI is charting above its 50 horizontal line and both divergences on RSI and MFI. Nevertheless we should be ready for both scenarios and we can.
How to be ready for an Upward scenario?
The answer is simple - use 121 MA as a resistance, in case this resistance is broken there will be a great chance that the Upward trend will resume. In order not to be fooled use confirmation from other indicators
-RSI - will have to visit the main overbought zone (during downtrend RSI never visited this zone, so it will definitely be a sign of a resumption of an Uptrend)
-20 MA - not only price chart have to cross the 121 MA resistance. To confirm the bullish crossover 20 MA has to cross 121 MA resistance as well.
-MFI - might be used as a confirmation of all these tools. Because this indicator uses volumes, you will notice if there is anything strange in a behavior of the price, despite if other indicators will behave well.
How to be ready for a Downward scenario?
You can use the same tools. But in case with a downward scenario we need to see:
-the price lose its pivot point support
-the price is moving back to its previous box
-the price crossing 20 MA from above (bearish cross)
-RSI have to cross its 50 horizontal line (which will mean that the indicator was in an overbought zone during a downtrend)
-MFI should be used as a confirmation in order not to be fooled
-And at last: the price needs to pass through zone of interest that has been formed be a candlestick with the most buying pressure.
Commonly downtrends are less aggressive. That means that price won't sharply drop. In case of a downtrend we might see retracements and price will slowly lose its positions.
Also use two of my previous ideas. They will help you to be well prepared.
Screenshot in addition: 121 MA is working as a support | 20 MA is approaching to the price.
Thank you for reading this idea! I really hope this information has been useful to you and you will find a way how to turn it into profitable information.
Please hit the like button in case you like this idea. Also do not forget to write your own thoughts and send your charts in comments below.
Remember this analysis is not 100% accurate. No single analysis is. To make a decision follow your own thoughts.
The information given is not a Financial Advise.
Be Unbiased!
//You should consider this idea as an extra to my two previous ones.
Let's start with Pivot Points. Pivot point indicator has a very simple calculation, it's just take the average between high, low and close of the previous period and put it forward. So we can see how price evolve relative to the previous period, in my case it is based on monthly period. What we currently see is that price is moving above the pivot point, which usually means ongoing bullish sentiment. But of course this case is a bit more complicated, because there are several strong resistances for the price on local levels (121 MA, $9.700 resistance, resistance zone (previous support zone for the descending triangle)) Currently the pivot point working as a support and might be a useful sign in case the price will save its position above this level, and also above the box, that Upward scenario will resume. Small remark - might be a useful sign, only if confirmed with other indicators (MFI, RSI, MAs).
Indicators:
MFI and RSI provide relatively the same information, but MFI (money flow index) use volumes for its calculations and this difference makes this indicator more sensitive and in some way faster to react on price movements. Pay attention on divergences on both of indicators MFI and RSI: MFI and RSI were charting higher lows in period when price was consolidating, but MFI had steeper trendline than RSI and its behavior was much clearer to understand the price was accumulating for the Upward movement. Also these indicators make me to think that the price is accumulating for the trend resumption, because RSI is charting above its 50 horizontal line and both divergences on RSI and MFI. Nevertheless we should be ready for both scenarios and we can.
How to be ready for an Upward scenario?
The answer is simple - use 121 MA as a resistance, in case this resistance is broken there will be a great chance that the Upward trend will resume. In order not to be fooled use confirmation from other indicators
-RSI - will have to visit the main overbought zone (during downtrend RSI never visited this zone, so it will definitely be a sign of a resumption of an Uptrend)
-20 MA - not only price chart have to cross the 121 MA resistance. To confirm the bullish crossover 20 MA has to cross 121 MA resistance as well.
-MFI - might be used as a confirmation of all these tools. Because this indicator uses volumes, you will notice if there is anything strange in a behavior of the price, despite if other indicators will behave well.
How to be ready for a Downward scenario?
You can use the same tools. But in case with a downward scenario we need to see:
-the price lose its pivot point support
-the price is moving back to its previous box
-the price crossing 20 MA from above (bearish cross)
-RSI have to cross its 50 horizontal line (which will mean that the indicator was in an overbought zone during a downtrend)
-MFI should be used as a confirmation in order not to be fooled
-And at last: the price needs to pass through zone of interest that has been formed be a candlestick with the most buying pressure.
Commonly downtrends are less aggressive. That means that price won't sharply drop. In case of a downtrend we might see retracements and price will slowly lose its positions.
Also use two of my previous ideas. They will help you to be well prepared.
Screenshot in addition: 121 MA is working as a support | 20 MA is approaching to the price.
Thank you for reading this idea! I really hope this information has been useful to you and you will find a way how to turn it into profitable information.
Please hit the like button in case you like this idea. Also do not forget to write your own thoughts and send your charts in comments below.
Remember this analysis is not 100% accurate. No single analysis is. To make a decision follow your own thoughts.
The information given is not a Financial Advise.
Be Unbiased!
