ONE → About to Dive? Will This Ascending Wedge Play out?
Updated
ONE is forming an ascending wedge after a strong bull run which usually ends in a break below the support line. Statistically, this is the more probable outcome and one we should be looking to take advantage of.
How do we trade this? 🤔
We need a break below the support line *and* a retest of the support line after the break, demonstrating that support became resistance. Once we see confirmation candles testing the new resistance, its reasonable to short and place a protective stop just above the wedge support line. Shoot for a 1:2 Risk/Reward Ratio down to the $0.0111 area. It's also reasonable to take half profits at 1:1 and swing the remainder of the position to a 1:3 take profit. Move the stop loss up to entry, securing profits and increasing your trade psychology by not worrying about losing money.
💡 Trade Idea 💡
Short Entry: $0.01420
🟥 Stop Loss: $0.01570
✅ Take Profit: $0.01120
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Ascending Wedge, Bias to Short.
2. Near Lifetime Resistance on the Weekly, Supports Short Bias.
3. 1HR RSI at 56.00, Some Up Before Down.
4. Wait for Price to Break Below Wedge and Confirm to Enter.
5. Bitcoin at Risk of Trend Change, Supports Short Bias.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
How do we trade this? 🤔
We need a break below the support line *and* a retest of the support line after the break, demonstrating that support became resistance. Once we see confirmation candles testing the new resistance, its reasonable to short and place a protective stop just above the wedge support line. Shoot for a 1:2 Risk/Reward Ratio down to the $0.0111 area. It's also reasonable to take half profits at 1:1 and swing the remainder of the position to a 1:3 take profit. Move the stop loss up to entry, securing profits and increasing your trade psychology by not worrying about losing money.
💡 Trade Idea 💡
Short Entry: $0.01420
🟥 Stop Loss: $0.01570
✅ Take Profit: $0.01120
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Ascending Wedge, Bias to Short.
2. Near Lifetime Resistance on the Weekly, Supports Short Bias.
3. 1HR RSI at 56.00, Some Up Before Down.
4. Wait for Price to Break Below Wedge and Confirm to Enter.
5. Bitcoin at Risk of Trend Change, Supports Short Bias.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
Note
We did not fall below the wedge support! Instead had a bounce (Which was the 4HR 200EMA) back into the wedge. The premise stands, wait for a break below with proper confirmation (retest of support as resistance with strong bear bars closing on or near their lows). Until then, wait on the sidelines for more price action!
-Joe Dean
Trader Engineering Course
**Available Now at TraderEngineering.com**
Trader Engineering Course
**Available Now at TraderEngineering.com**
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.