Hi friends! Congratulations to my Twitter followers who came in strong with a second place vote, on NEO, during this week's #coinvote! Let's get right to it! Looking at the four hour chart, something very obvious immediately sticks out. Neo has broken up above some very important moving averages, and it has managed to find repeated support above them. As you can see, NEO first rallied above the 50 EMA (in orange) and then it traded all the way above the 200 EMA (in purple) and the 1200 EMA (in red.) The 1200 EMA, on the four hour chart, is equal to the 200 EMA from the daily chart. So, it is an important level to look at. Without a doubt, NEO has just found rock solid support on top of those moving averages, and now it's heading higher. Also worth noting, you can see that the EMAs are all converging together, and it looks like the faster averages are trying to overtake the slower averages. That is indicative of a longer-term trend reversal, so this is definitely a positive thing to see. Furthermore, you can see that there has been a bullish crossover on the MACD, as the momentum continues to find support off of a long-forming bullish divergence.
Those things are all very positive, but there is some important overhead resistance to be aware of. Particularly, the upper trendline of what may be a false flag. If you've been following my recent posts, you know that I've been covering the concept of the false flag, which is something that I use in my personal analyses, that isn't generally found in formation literature. The false flag has a flagpole, with a rising flag body that extends above the top of the pole. I've noticed that these formations tend to result in a break to the downside, but they can extend for considerable amounts of time, before the breakdown. I would say about 80% of the false flags that I have seen, have broken to the downside in some capacity. So, just be aware of that formation, and that it could cause problems for NEO. Personally, I do like the hold on the moving averages, but I will not be a buyer here. I would rather wait until NEO surpasses the falling black trendline. Under those conditions, assuming that we are still above the moving averages, there would be much less overhead resistance to contend with, and thus a greater risk/reward ratio for the trade.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
-JD-
Those things are all very positive, but there is some important overhead resistance to be aware of. Particularly, the upper trendline of what may be a false flag. If you've been following my recent posts, you know that I've been covering the concept of the false flag, which is something that I use in my personal analyses, that isn't generally found in formation literature. The false flag has a flagpole, with a rising flag body that extends above the top of the pole. I've noticed that these formations tend to result in a break to the downside, but they can extend for considerable amounts of time, before the breakdown. I would say about 80% of the false flags that I have seen, have broken to the downside in some capacity. So, just be aware of that formation, and that it could cause problems for NEO. Personally, I do like the hold on the moving averages, but I will not be a buyer here. I would rather wait until NEO surpasses the falling black trendline. Under those conditions, assuming that we are still above the moving averages, there would be much less overhead resistance to contend with, and thus a greater risk/reward ratio for the trade.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
-JD-