Current Bullflag Grows Bigger Allows Potential For Bigger Upside
On the rwecent 4 hour candle we can see thaat it has dipped down to test the T line a few times..even wicking below it once...whle for the most part the body of the candle is finding supprot right at the bottom green trendline of the current bull flag. The T line and the bottom trendline of the bull flag are close enough to eachother in proximity that they are somewhat acting as a team of double reinforced support. I still think this will likely be a bullish breakout considering we haven't yet hit the target of the descending purple wedge breakout...and now if it is a bullish breakout the added height to the flag would have our projected bullish price target surpass the original descending wedge target price. All very possible..However we need to strongly consider the alternative outcome of a bearish breakout which I have illustrated the projected target price of a bearish breakout too which would carry us back down to the buy sell line as likely support considering it is being double reinforced by the red fib retracement line. Both outcomes are possible so this idea will stay neutral but my bias is still to the upside so I think the bullish breakout has the highest probability and if not, on a bearish breakdown, I think once we hit the 50 SMA if it wouldrebounc pretty nicely and continue upward. Just my thoughts, not financial advice...I plan on laddering in at the dips.
Comment:
One thing to make note of that I typically don't on my ideas i the 1 hr chart...the tline on each timeframe is going to be different but just as important a signal...and on the 1 hour chart the last 1 hour candle closed below the 1 hour charts tline...if the current 1 hr candle closes under the tline as well...that greatly increases the odds of a bearish breakdown out of this bull flag.
Comment:
the hour chart currently has the t line acting as resistance...if the 1 hour candle climbs back up to the 1 hr T line and is rejected again with the 1 hr tline acting once again as resistance...that is a good sign that we will likely have a bear break from the current bull flag pattern on the 4 hour.
Comment:
it appears as if the t line on the 4 hour is now resistance and the 78.60% aqua fib retracement line is current support...if we close this candle as a bearish breakout I will look to short and buy back in just above the red fib line. We still have 2 horus left in the candle though so anything can happen..we did wick back above the t ine temporarily so odds are it will test the t line again if we get above it again there's a chance we may crawl back inside the bullflag paramaters before the candle closes but for now the probability is more greatly leaning towards the odds of a bearish break.
Comment:
The t line is fortunately back to acting as support for now and we have climbed back above the green trendline and back inside the bull flag formation...let's hope this holds by the time the candle closes but also be completely prepared if it decides to dip back under the t line again, thus confirming a bearish breakdown. right now now it could go either way.
Comment:
back to back bullish reversal hammers on the 1 hour chart indicate a bullish trend reversal is likely...this last bullish reversal hammer was green, also a good sign...the drop likely happened because the 1 hour rsi had reached overbought conditions and also people were likely taking profits from the bull run thus far. Hopefully these reversal ammers on the 1 hour will help lift the 4 hour candle back into the bull flag and keep it there or better yet allow it to find a way to break upward out of the flag....best to keep an eye on the upcoming 1hr candle to see how it reacts to the 1 hour t line if it goes up to test it...if it can get above the 1 hr t line then I'd say we are safe from any sort of bearish breakdown during the current 4 hr candle.
Comment:
we have technically closed the 4 hour below the bull flag trend line...if we close one more candle on the 4 hour below it it will confirm the bearish breakdown. On the 1 hour chart we currently have a bear flag forming....if that breaks down it will certainly trigger a bearish break on the 4 hour....since we have not yet reached the target price of the descending wedge I think worst case scenario is probably that we would fall back down to the 50MA on the 4hour which would act as strong support and send us rebounding back up....however being in a buyers markert it can be a bit of a risk to short right now so it may be wiser to just ladder in at the 50 MA than risk shorting your position and having the price take back off before it reaches the 50MA.
Comment:
it appears that the 1 hr candle is going to close as a bullish breakout above the smaller bear flag it formed...we will of course want to look for at least 1 confirmation candle on the 1 hour to confirm the bullish breakout, but if so, then it should give it a price projection target high enough to send us just under the upper trendline of the bigger green bull flag....Also, now that we have found a trendline that gets a couple touches on the last couple 4hr candles, it appears that the original bull flag was wider than we initially thought and the bottom green dotted trendline will be adjusted accordingly...due to this, we have actually still been inside the original bull flag this whole time which means the probability of a bullish breakout from the flag is now slightly greater in favor of a bullish breakout ....this was just a bearish breakdown fakeout.... for now....***disclaimer: none of this is financial advice***