Theta has been in beast mode since December and has recently been dipping in and out of the top 10 by market cap. We have seen a small correction, but where do we go from here?
Initially looking at the short term group of timeframes (90m, 3h, 6h, 12h)
Currently the Energy is higher than the Green EMA in all this group of timeframes indicating downward pressure. Downward pressure does not necessarily translate into downward price action but sideways at best downwards at worst.
Although the Energy is higher than the Green EMA we can see some bullish signs in these timeframes. In the 90m the Red RSI & Blue LSMA have crossed harmoniously above level 50 and the Red RSI has just crossed bullish above the Blue LSMA. The Green EMA has begun to move out to the side as the Energy falls, it looks as though this will allow the Energy to drop below the Green which would indicate bullish sentiment in this timeframe, however it is also possible that the Green can continue down allowing the Red RSI & Blue LSMA to make contact with it as it falls which if closing in this position would indicate that the Energy is likely to cross below 50 on the next candle indicating a period of downward pressure. So watch this space.
To get an early view of what is likely to happen in these timeframes we need to look at the scalping group (6, 12, 23, 45)
In the 6 we are obviously entering a period of downward pressure, in the 12m the Energy is higher than the Green and the Green is about to cross below 50 but has not yet done so. The Energy is higher than the Green EMA in the 23 too, so nothing in this group to indicate a reversal to upward pressure currently, but considering the shortness of these timeframes the position can change rapidly. But we are currently bearish.
We currently have a downward pressure race between the Energy in the 23 & the Red RSI in the 45.
When the Red RSI fell below 50 in the 23m a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the 23m CLOSE above 50 before the Red RSI in the 45 CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 45 and the Red RSI in the 90 etc. It does look like the Energy in the 23m will win the race.
Until the race is won, we do not have a chance to see reversal to sustained upward pressure.
Again I must emphasize that this is a snapshot of current market dynamics in very short timeframes so can quickly change. Changes here can propagate up through higher timeframes.
Near term group of timeframes (1d, 2d, 3d, 4d)
The Green EMA is higher than the Energy in all this group of timeframes which indicates bullish sentiment. We do however need to be mindful of the fact that the Red RSI and Blue LSMA are heading downward and the Red RSI is close to crossing below 50 in the daily, the Blue LSMA is also heading toward level 50. The Green EMA has crossed but not closed below 50 in the 2d, if we close below 50 in 1d 16h the price action is likely to fall to the proximity of the Bollinger Band basis, (currently $8.03 but rising). The Green EMA is also getting close to level 50 in the 3d and we have closed with the Red RSI and Blue LSMA making contact with the Green as it falls, as a result we have seen the Energy fall below 50 indicating a period of downward pressure.
In the Mid Term group of timeframes (3d, 6d, 9d, 12d)
Again bullish sentiment is reflected by the fact that the Green EMA is higher than the Energy in all this group of timeframes. But we do have a large gap between the Green and the Energy which could reflect a precarious balance which could support a precipitous drop - but not necessarily. Due to the limited data for this pair it is difficult to infer too much info from the longer timeframes.
In summary: I am currently marking this as neutral as I dont feel there is a case to definitively support a view for Bullish or Bearish price action currently.
My view is that Theta remains bullish in the mid to long term but we are still experiencing downward pressure in the short term and we are not quite ready for reversal to sustained upward pressure. By the same token, particularly considering the tightness of the BBs we will not necessarily see significant downward price action and may well trade sideways withing a relatively tight range in the short term
As mentioned in previous publications, these markets can change with very little notice. These changes initially manifest themselves in the lower timeframes and propagate up through the timeframes. Nothing is set in stone. Unless you are day trading, you cannot benefit from these early warning signals.
As always - this is not financial advice but just my view of current market dynamics.
One has to be aware that analyses are done on the basis of what the indicators are saying at the time and things can change. It is important to always monitor the scalping group of timeframes as we will see changes propagate up from there.
Trade safe
aBL
Initially looking at the short term group of timeframes (90m, 3h, 6h, 12h)
Currently the Energy is higher than the Green EMA in all this group of timeframes indicating downward pressure. Downward pressure does not necessarily translate into downward price action but sideways at best downwards at worst.
Although the Energy is higher than the Green EMA we can see some bullish signs in these timeframes. In the 90m the Red RSI & Blue LSMA have crossed harmoniously above level 50 and the Red RSI has just crossed bullish above the Blue LSMA. The Green EMA has begun to move out to the side as the Energy falls, it looks as though this will allow the Energy to drop below the Green which would indicate bullish sentiment in this timeframe, however it is also possible that the Green can continue down allowing the Red RSI & Blue LSMA to make contact with it as it falls which if closing in this position would indicate that the Energy is likely to cross below 50 on the next candle indicating a period of downward pressure. So watch this space.
To get an early view of what is likely to happen in these timeframes we need to look at the scalping group (6, 12, 23, 45)
In the 6 we are obviously entering a period of downward pressure, in the 12m the Energy is higher than the Green and the Green is about to cross below 50 but has not yet done so. The Energy is higher than the Green EMA in the 23 too, so nothing in this group to indicate a reversal to upward pressure currently, but considering the shortness of these timeframes the position can change rapidly. But we are currently bearish.
We currently have a downward pressure race between the Energy in the 23 & the Red RSI in the 45.
When the Red RSI fell below 50 in the 23m a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the 23m CLOSE above 50 before the Red RSI in the 45 CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 45 and the Red RSI in the 90 etc. It does look like the Energy in the 23m will win the race.
Until the race is won, we do not have a chance to see reversal to sustained upward pressure.
Again I must emphasize that this is a snapshot of current market dynamics in very short timeframes so can quickly change. Changes here can propagate up through higher timeframes.
Near term group of timeframes (1d, 2d, 3d, 4d)
The Green EMA is higher than the Energy in all this group of timeframes which indicates bullish sentiment. We do however need to be mindful of the fact that the Red RSI and Blue LSMA are heading downward and the Red RSI is close to crossing below 50 in the daily, the Blue LSMA is also heading toward level 50. The Green EMA has crossed but not closed below 50 in the 2d, if we close below 50 in 1d 16h the price action is likely to fall to the proximity of the Bollinger Band basis, (currently $8.03 but rising). The Green EMA is also getting close to level 50 in the 3d and we have closed with the Red RSI and Blue LSMA making contact with the Green as it falls, as a result we have seen the Energy fall below 50 indicating a period of downward pressure.
In the Mid Term group of timeframes (3d, 6d, 9d, 12d)
Again bullish sentiment is reflected by the fact that the Green EMA is higher than the Energy in all this group of timeframes. But we do have a large gap between the Green and the Energy which could reflect a precarious balance which could support a precipitous drop - but not necessarily. Due to the limited data for this pair it is difficult to infer too much info from the longer timeframes.
In summary: I am currently marking this as neutral as I dont feel there is a case to definitively support a view for Bullish or Bearish price action currently.
My view is that Theta remains bullish in the mid to long term but we are still experiencing downward pressure in the short term and we are not quite ready for reversal to sustained upward pressure. By the same token, particularly considering the tightness of the BBs we will not necessarily see significant downward price action and may well trade sideways withing a relatively tight range in the short term
As mentioned in previous publications, these markets can change with very little notice. These changes initially manifest themselves in the lower timeframes and propagate up through the timeframes. Nothing is set in stone. Unless you are day trading, you cannot benefit from these early warning signals.
As always - this is not financial advice but just my view of current market dynamics.
One has to be aware that analyses are done on the basis of what the indicators are saying at the time and things can change. It is important to always monitor the scalping group of timeframes as we will see changes propagate up from there.
Trade safe
aBL
In addition:
We now have a downward pressure race between the Energy in the daily & the Red RSI in the 2d.
When the Red RSI fell below 50 in the daily a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the daily CLOSE above 50 before the Red RSI in the 2d CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 2d and the Red RSI in the 4d etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for reversal to upward pressure in the relevant timeframes.