Another explanatory post. H4/D1 charts will be added to clarify some markers and provide a long-term analysis.
Highlighted are 3 zones (patterns) previously discussed along with a 4th outlined zone.
-> Zone 1 (red) - between upper triangular resistance and lower support (dotted red) - On 1/27 I provided a scenario where a bearish breakout would occur if consolidation within this area continued; today I'll explain why I believe it didn't. Although we dipped below average (dotted black), which was the assumed low at the time, we were able to establish an actual lower support. The increase in buy volume off this hold sent us back above long-term trendline (solid purple), which maintained price on several dip attempts. This provided enough momentum to break lower triangular resistance, and ultimately 2500 to upper triangular resistance. If sideways action continued until UTR was below 2500 or price was rejected during yesterday's candle, we may have experienced a second bottom (not to be confused with smaller second bottom).
-> Zone 2 (blue) - between 2500 and lower support - An ascending triangle at first resistance or second support. Breakout pushed us to 2550.
-> Zone 3 (orange) - between 2550 and lower support - An ascending triangle at second resistance or first support. Breakout pushed us from H1 200EMA to 2600 neckline.
-> Zone 4 (purple) - between 2600 neckline and lower support - An ascending triangle at third resistance. With the assumption that a second smaller bottom formed off yesterday's price action, we can speculate that a breakout could occur to roughly 2750. However we can also presume that a third bottom will develop; given the fact that long-term trendline will soon fall below lower triangular support this seems to be a bullish scenario as well.
Highlighted are 3 zones (patterns) previously discussed along with a 4th outlined zone.
-> Zone 1 (red) - between upper triangular resistance and lower support (dotted red) - On 1/27 I provided a scenario where a bearish breakout would occur if consolidation within this area continued; today I'll explain why I believe it didn't. Although we dipped below average (dotted black), which was the assumed low at the time, we were able to establish an actual lower support. The increase in buy volume off this hold sent us back above long-term trendline (solid purple), which maintained price on several dip attempts. This provided enough momentum to break lower triangular resistance, and ultimately 2500 to upper triangular resistance. If sideways action continued until UTR was below 2500 or price was rejected during yesterday's candle, we may have experienced a second bottom (not to be confused with smaller second bottom).
-> Zone 2 (blue) - between 2500 and lower support - An ascending triangle at first resistance or second support. Breakout pushed us to 2550.
-> Zone 3 (orange) - between 2550 and lower support - An ascending triangle at second resistance or first support. Breakout pushed us from H1 200EMA to 2600 neckline.
-> Zone 4 (purple) - between 2600 neckline and lower support - An ascending triangle at third resistance. With the assumption that a second smaller bottom formed off yesterday's price action, we can speculate that a breakout could occur to roughly 2750. However we can also presume that a third bottom will develop; given the fact that long-term trendline will soon fall below lower triangular support this seems to be a bullish scenario as well.
Note
H4 Chart Analysis
Note
D1 Chart Analysis
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Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.