Yet again we are in the bouncy bounce territory and questions as always are the same. a. How long ? and b. How far? From today's perspective, we see that momentum oscillators are trying to reset, and the result of reset on lower timeframes will dictate the direction of the next move. Several things to look for: 1. 10 simple and medium line of the Bollinger are coming at the same place @8250, so this area as a next target has a lot of confluence. 2. 8250 will most likely reject the price action on the first try, but following attempts will most likely regain 10 simple. 3. If at least 4H candle closes above 10 SMA, we might see the follow through to the next levels of confluence fib .2236 located at 8320 and next to .382 nested at 8690 region. 4. Closure of daily above .382 at 8690 has the potential to reset and reverse the bearish trend. 5. My proprietary indicator for buy/sell signals, which has been a marvellous tool to indicate phenomenal long and short term trades has not given a buy signal yet, which gives me a hint to remain neutral and fully in cash as long as the bounce takes place. 6. Wave trend on daily shows that it wants to create a smaller trigger wave which is confluent with the situations when the trend reversal is likely to take place. If you take a look, we had a similar kind of signature in December 2018, and full formation of the trigger wave has resulted in the marvellous bullrun. tradingview.com/x/JhG1Uq4I/. As you can see, the pattern is somewhat similar. In the both cases we have large anchor wave reaching below -80%, we have smaller size trigger waves following shortly after and in both cases money flow (red) is cutting back to the zero line. I don't usually put much weight on a fractals like this, yet it is still interesting to see how it plays out. 7. I am out of my positions now and have no interest to long this market as long as 10 simple and median of the BB is not gained back. If we fail to close the daily candle below 7850 I am not interested in shorting the market either. 8. My current sentiment is predominantly bearish. If we start closing dailys over 8690, by all means, I will get my bulhead from the closet, but till then - the shorting is the way to go. 9. If we get rejected by the top band of the BB at 8600 and are unable to close daily candle above it, I'll be more than happy to open the short again.
Conclusion: One thing is obvious, we are looking into a massive move that will potentially take place in the upcoming days. Small signs will identify the direction of the move.
Suggestion: Don't front-run the market and don't risk your capital on 50$ moves when there is a potential thousand dollar move staring at us.
Agreed on the above, it seems like the safe move is to feel bearish but act neutral. Why try to pick up pennies in front of trains?
akublashvili
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@SPINKICK, Indeed as suspected the 10 SMA and median band of the BB has rejected the price, yet I am not convinced that we will not try to break that resistance again within next 24 hours. I would be full-on bearhead in similar circumstances, however, there are several things that make me think that that possible sizable bounce might be in the cards. 1. BB on daily is in extreme squeeze, which eventually will result in a massive breakout or breakdown 2. 4 hour RSI is finally getting itself out from the bearish zone and is upheld by 12EMA , the case is the same for the daily RSI it finally has breached the resistance of the 12EMA and is currently heading towards the bullish control zone. Question is - is this enough evidence for reversal hopium? - No, not really 3. "Volatility based expected moves" are also pointing to the upside, and first standard deviation lies at around 8250-8300, so I think the continuation is more than likely. This being said "longing" now will be a dumb and unjustifiable risk when we have so many confluent resistance areas looming overhead.