The price is currently moving around the weekly support (worth zooming out before evaluating this trade).
We had a relatively high volume impulse move up after hitting the lows at 3120 more than a month ago.
Now the price has spent weeks after that slowly correcting downwards on low volume, which makes me see this as a retracement instead of another impulse move to the downisde.
Knowing the difference in characteristics between an impulse move and a correctional move is very important here.
Additionally, we have a falling wedge pattern forming, indicating the selling momentum is slowing down at these levels.
When looking at classical charting patterns, it is important to look at the context in which they form.
Breakout above 3560 will be the confirmation (safer approach). Once (and if) that happens, the targets above will be active.
Crucial support is in 3336-3250 area. If we see a daily candle close below that, the reason for entering this trade will no longer be valid, and in that case we might see the lows at 3120 taken out before a possible stronger bounce up again from the 3066-2876 area.
That is out of the scope for this analysis, and I will make a new one if we see that happen.
Right now I see it as more likely that the grey support area will hold.
Another move down into the grey area (major support zone) is still possible (which would offer ideal entry opportunity with a close stop loss under), but none of the daily candles must close below 3250 (wicks/stop loss hunts are still possible and do not invalidate the idea).
Consolidation always leads to expansion.
We had a relatively high volume impulse move up after hitting the lows at 3120 more than a month ago.
Now the price has spent weeks after that slowly correcting downwards on low volume, which makes me see this as a retracement instead of another impulse move to the downisde.
Knowing the difference in characteristics between an impulse move and a correctional move is very important here.
Additionally, we have a falling wedge pattern forming, indicating the selling momentum is slowing down at these levels.
When looking at classical charting patterns, it is important to look at the context in which they form.
Breakout above 3560 will be the confirmation (safer approach). Once (and if) that happens, the targets above will be active.
Crucial support is in 3336-3250 area. If we see a daily candle close below that, the reason for entering this trade will no longer be valid, and in that case we might see the lows at 3120 taken out before a possible stronger bounce up again from the 3066-2876 area.
That is out of the scope for this analysis, and I will make a new one if we see that happen.
Right now I see it as more likely that the grey support area will hold.
Another move down into the grey area (major support zone) is still possible (which would offer ideal entry opportunity with a close stop loss under), but none of the daily candles must close below 3250 (wicks/stop loss hunts are still possible and do not invalidate the idea).
Consolidation always leads to expansion.
Comment:
After reaching the first two targets, the price has just made an upthrust, wicking above the previous highs before the move in the opposite direction takes place.
Supply tested. Liquidity absorbed. No buyers followup.
I want to see how this candle closes, but this has a clear bearish bias now.
Especially if the daily candle closes below 3610.
Supply tested. Liquidity absorbed. No buyers followup.
I want to see how this candle closes, but this has a clear bearish bias now.
Especially if the daily candle closes below 3610.
Comment:
Main target nearly reached.
Worth taking some profit here already.
Look to add more on pullback in the 3720-3650 area.
Excellent bullish action from the entire crypto market today.
Worth taking some profit here already.
Look to add more on pullback in the 3720-3650 area.
Excellent bullish action from the entire crypto market today.
Trade closed: target reached:
3336-3250 key support area mentioned in the original analysis held perfectly.
The price bounced from 3330.