BICO expectation (1D 1H)
In my previous post about BICOUSDT, I've watched the market for the entry opportunity but unfortunately it slipped. Click above to check.
The price is now below the resistance line of the weekly downtrend again, but is refusing to continue the downtrend - normally when the breakout fails, price drops without hesitation.
Look at what happened in July, for example, we see price being immediately pulled back after touching the resistance line.
It did show some price action around 0.2978 after the touch, but eventually continued with the downtrend.
So what's the difference between then and now?
There are several differences, first one being the breakout. Previous touches did not break through the resistance line - price reversed as soon as they touched it. This time, however, the price managed to breakout and stayed above the line for a while. This is significant because the price finally managed to breathe fresh air after several failed attempts.
The second difference is consolidation after the breakout.
We already see two respectful bounces after the pullback. I say 'respectful' because the bullish reversal is very strong. As soon as the price touches the level, it almost immediately bounces back up with strong momentum.
The third difference is the most important: volume.
Have a look at the volume here. Previous highs do not have any significant volume spikes.
By my calculation, average daily volume was around 4 - 5 million USDT during the downtrend.
Last 5 days had volume of 420+ million USDT in total. This is a significant spike we cannot overlook. Volume does not lie.
Let's look at July 17th when the breakout happened. We see the initial breakout, pullback, second breakout and an uptrend.
These two points would be where we would've entered.
First entry is where we confirm the breakout and the break of structure,
second is where we confirm the reversal of trend after touching the resistance line.
The uptrend unfortunately stopped and reversed in 0.3643.
Similarly, if we see a break of structure where the green arrow points at, this will be our first entry for LONG.
Even better entry would be here where the price pulls back to the BoS level and shows reversal.
Where would we set our TP and SL?
For TP, there are five different levels we can expect a resistance.
I would sell most of my position by 0.3643. I will leave some to possibly sell at 0.4.
If the price fails to reach 0.4, I will exit then.
SL would be where the price pulls back to the resistance line.
However, if we confirm a reversal there, we might shoot for a new entry.
If not, new opportunity will knock at our door for SHORT!
Comment
It seems BICO is very good at respecting the zone.
Look at the red square in this chart - as soon as it hits the bottom line of the zone, the price moves back up with strong momentum. Almost perfect.
Now it is above the weekly resistance line again - if we see the BoS here, that would be our entry for LONG.
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