1. Resistance Area Weakness
The resistance zone is marked as a strong rejection area, but there's a possibility that instead of reversing, price could break through. A break above could indicate bullish momentum rather than a reversal.
Instead of assuming a rejection, watch for liquidity grabs above the weak high.
2. Support Area Strength Overestimation
The support zone is considered a strong level for reversal, but if the market is in a strong bearish trend, the support may fail.
Instead of assuming a bounce, consider the possibility of a breakout below support, leading to a further drop
3. Market Structure Bias
The analysis focuses on a bearish move from the resistance area, but the recent rally before resistance suggests that buyers were strong.
A "Change of Character" (ChoCH) may not always lead to a reversal; sometimes it can be a trap before continuing higher.
4. Alternative Scenarios
Instead of the expected drop, price could range between resistance and support before a bigger breakout.
Liquidity could be built up near the resistance zone, causing a fakeout before an actual move.
The resistance zone is marked as a strong rejection area, but there's a possibility that instead of reversing, price could break through. A break above could indicate bullish momentum rather than a reversal.
Instead of assuming a rejection, watch for liquidity grabs above the weak high.
2. Support Area Strength Overestimation
The support zone is considered a strong level for reversal, but if the market is in a strong bearish trend, the support may fail.
Instead of assuming a bounce, consider the possibility of a breakout below support, leading to a further drop
3. Market Structure Bias
The analysis focuses on a bearish move from the resistance area, but the recent rally before resistance suggests that buyers were strong.
A "Change of Character" (ChoCH) may not always lead to a reversal; sometimes it can be a trap before continuing higher.
4. Alternative Scenarios
Instead of the expected drop, price could range between resistance and support before a bigger breakout.
Liquidity could be built up near the resistance zone, causing a fakeout before an actual move.
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.
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.