📊🌟 "DYDX Coin Analysis - Preparing for a Potential Drop?" 🚨📉💹 Let's analyze and review this cryptocurrency, DYDX, which is one of the decentralized exchanges in the crypto world.
📝 Market Overview:
Before diving into the analysis, it's important to note that the Ethereum ETF has been approved, similar to Bitcoin. This is great news for investors, but it is expected to start operations in about 2 months. This could potentially slow down the market and increase the likelihood of a correction. However, regardless of market sentiment, my trading strategy will be based on activated triggers, so don't let external news influence your decisions too much.
🔎 Higher Time Frames:
Like many other cryptocurrencies, DYDX is in a long-term consolidation phase within a 700-day range. The recent upward movement towards the upper limit of the range saw an increase in volume, but upon hitting the resistance at 4.403, it started to decline and returned to its consolidation range.
🔄 Four-Hour Time Frame:
In the four-hour chart, after breaking the support at 2.866, DYDX experienced a 30% drop and has been unable to recover. It is now forming a consolidation box, making it a potential candidate for a short position in the upcoming week.
📊 Fixed Volume Range Tool:
I use this tool to determine when not to open a position as long as the price remains within high-volume areas. Conversely, once these high-volume areas are broken in the direction of the trend, I open my position based on a breakout strategy. This tool serves both as a confirmation and a deterrent. I'll explain more about this tool and potentially a strategy involving it in the future.
📉 Short Position:
Our support level is clearly defined. After breaking the 1.926 mark, we can continue our short position in line with the trend. This level not only acts as a support line but can also be considered the middle line of the box, indicating a higher likelihood of reaching the lower end of the range.
📈 Long Position:
Currently, I am not opening any long positions on this coin due to its downward trend and lack of buying pressure. I suggest waiting for a trend reversal before considering a long position. For a riskier long position, you could open at 2.191, but only after it reacts to this level, breaks through with increased volume, and shows strong buying pressure.
💰 Buying DYDX:
Patience is key for now. We need to wait for DYDX to break out of the top of its consolidation box and show an upward trend against Bitcoin before considering a buy. There are currently better opportunities in the market.
📚 Decentralized Exchanges:
It is also crucial to study decentralized exchanges as there is a possibility that centralized exchanges might face issues in the future, similar to FTX. It's better to gain knowledge about decentralized exchanges early on.
🔻 Support Levels:
1.661, 1.510
🔺 Resistance Levels:
2.429, 2.866
😊 If you'd like me to analyze a specific coin or currency pair, be sure to comment so that I can allocate the next analysis for you!
⚠️ Also, please remember that I'm just an analyst, and this isn't financial advice. We're here to stay in the market and maximize profits by adhering to risk and capital management principles.
