Todays analysis – ZILBTC – trading in a possible descending channel, currently testing local support.
Points to consider: - Flow in the market/price action - Respecting key Fibonacci levels - Resistance Confluence - Trend Reversal - Low Volume - RSI below 50
ZILBTCs healthy counter-trend and strong continuation adds legitimacy to the money flow.
The previous swing-low respecting .618 Fibonacci retracement is indicative of a current retrace to .618 Fibonacci level.
The .618 Fibonacci level also coincides with descending channel resistance. A rejection at this level will solidify a trend reversal with a lower swing high.
An increase in volume is necessary to add legitimacy in the overall market.
RSI attempting to recover from oversold conditions. A countertrend will neutralise and prime the oscillator for a trend continuation.
Overall, in my opinion, a short trade is validated at the rejection of the resistance confluence with a technical target of local support. Entering the trade at resistance confluence consents immediate trade invalidation (price trading beyond resistance zone), mitigating overall risk.
What are your thoughts? Let me know in the comments below!
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