Upward pressure likely to continue after a short dip
Updated
Super busy at the moment so just a very quick multi timeframe look at Solana.
We need to monitor the "downward pressure races" described below to ascertain this progression on an ongoing basis.
In the lower timeframes (below 2h) the Red RSI is below level 50 indicating downward pressure.
In the two hour timeframe the Red RSI has also crossed below level 50 during this period of downward pressure.
When the Red RSI fell below 50 in the 2h a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the 2h CLOSE above 50 before the Red RSI in the 4h CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4h and the Red RSI in the 8h etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for resumption of upward pressure in the relevant timeframes.
We must however consider that currently the overall sentiment is bullish in this group of timeframes as indicated by (in every case) the Green EMA being higher than the Energy.
When the Blue LSMA in the 2h changed direction and both the Red RSI and Blue LSMA made contact with the Green EMA as it descended this was an early indication that we were approaching a period of downward pressure. In order to tell how long this period is likely to be we need to look at higher timeframes.
Additionally the due to the above factors the Bollinger Bands have contracted and volume has tailed off.
Firstly lets look at the 4h
We can see here too that the Red RSI and Blue LSMA have made contact with the Green EMA as it descends, this indicates in this timeframe also the start of a period of downward pressure, this is evidenced by the Energy falling below 50 on the following candle.
Again in the 8h we can see the same and the Energy here to has begun to fall below level 50.
In order to get an indication of the duration of this period of downward pressure, as I said we need to look at higher timeframes.
We can see in the daily that the Green EMA has turned back up and the Red RSI has made contact with it as it rises. This is an indication of upward pressure, in fact the Energy only dipped very slightly below 50 before turning back up. We also saw the Red RSI cross bullish above the Blue LSMA. The Bollinger Bands are highly expanded in the daily and because of the level of the Red RSI & Blue LSMA above 80 we can expect the price action to remain with the candle bodies for the most part residing between the Aqua/Orange BBs. However at this level we have to consider that the Red RSI and Blue LSMA are in oversold territory and there is a large gap between the Geen EMA and the Energy, this indicates a potentially precipitous situation during which the price action could quickly fall.
In the next group of timeframes show here, 2d, 3d, 4d, 8d we can also see a situation where the Red RSI and Blue LSMA are very high and the Energy is flirting around level 50.
We have to consider that when the current 4d candle closes in 1d 10h if the Green EMA closes descending while the Red RSI makes contact with it we are likely to see the Energy fall below 50 in this timeframe too, indicating downward pressure. However, IMO looking at the 8d I believe if it dips below 50 at all it will be briefly and possibly only for the duration of that 4d candle. I say this because 1.) in all the timeframes in this group, the Green EMA is higher than the Energy indicating bullish sentiment. 2.) in the 8 hour the Red RSI is significantly above level 56 - in fact above level 80. It is highly likely that upward pressure will continue until the Energy crosses below level 60 in this timeframe which looks unlikely to happen for another two 8 day candles after this one closes in 1d 10 hours.
When the Red RSI fell below 50 in the 2d a downward pressure race was triggered. In order for upward pressure to continue, we first need to see the Energy in the 2d CLOSE above 50 before the Red RSI in the 4d CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4d and the Red RSI in the 8d etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for reversal to upward pressure in the relevant timeframes.
When the Red RSI fell below 50 in the 2d a downward pressure race was triggered. In order for upward pressure to continue, we first need to see the Energy in the 2d CLOSE above 50 before the Red RSI in the 4d CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4d and the Red RSI in the 8d etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for reversal to upward pressure in the relevant timeframes.
As mentioned in previous publications, these markets can change with very little notice. These changes initially manifest themselves in the lower timeframes and propagate up through the timeframes. Nothing is set in stone. Unless you are day trading, you cannot benefit from these early warning signals.
As always - this is not financial advice but just my view of current market dynamics.
One has to be aware that analyses are done on the basis of what the indicators are saying at the time and things can change. It is important to always monitor the scalping group of timeframes as we will see changes propagate up from there.
If you got value from this analysis, please hit the like button
Trade safe
aBL
We need to monitor the "downward pressure races" described below to ascertain this progression on an ongoing basis.
In the lower timeframes (below 2h) the Red RSI is below level 50 indicating downward pressure.
In the two hour timeframe the Red RSI has also crossed below level 50 during this period of downward pressure.
When the Red RSI fell below 50 in the 2h a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the 2h CLOSE above 50 before the Red RSI in the 4h CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4h and the Red RSI in the 8h etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for resumption of upward pressure in the relevant timeframes.
We must however consider that currently the overall sentiment is bullish in this group of timeframes as indicated by (in every case) the Green EMA being higher than the Energy.
When the Blue LSMA in the 2h changed direction and both the Red RSI and Blue LSMA made contact with the Green EMA as it descended this was an early indication that we were approaching a period of downward pressure. In order to tell how long this period is likely to be we need to look at higher timeframes.
Additionally the due to the above factors the Bollinger Bands have contracted and volume has tailed off.
Firstly lets look at the 4h
We can see here too that the Red RSI and Blue LSMA have made contact with the Green EMA as it descends, this indicates in this timeframe also the start of a period of downward pressure, this is evidenced by the Energy falling below 50 on the following candle.
Again in the 8h we can see the same and the Energy here to has begun to fall below level 50.
In order to get an indication of the duration of this period of downward pressure, as I said we need to look at higher timeframes.
We can see in the daily that the Green EMA has turned back up and the Red RSI has made contact with it as it rises. This is an indication of upward pressure, in fact the Energy only dipped very slightly below 50 before turning back up. We also saw the Red RSI cross bullish above the Blue LSMA. The Bollinger Bands are highly expanded in the daily and because of the level of the Red RSI & Blue LSMA above 80 we can expect the price action to remain with the candle bodies for the most part residing between the Aqua/Orange BBs. However at this level we have to consider that the Red RSI and Blue LSMA are in oversold territory and there is a large gap between the Geen EMA and the Energy, this indicates a potentially precipitous situation during which the price action could quickly fall.
In the next group of timeframes show here, 2d, 3d, 4d, 8d we can also see a situation where the Red RSI and Blue LSMA are very high and the Energy is flirting around level 50.
We have to consider that when the current 4d candle closes in 1d 10h if the Green EMA closes descending while the Red RSI makes contact with it we are likely to see the Energy fall below 50 in this timeframe too, indicating downward pressure. However, IMO looking at the 8d I believe if it dips below 50 at all it will be briefly and possibly only for the duration of that 4d candle. I say this because 1.) in all the timeframes in this group, the Green EMA is higher than the Energy indicating bullish sentiment. 2.) in the 8 hour the Red RSI is significantly above level 56 - in fact above level 80. It is highly likely that upward pressure will continue until the Energy crosses below level 60 in this timeframe which looks unlikely to happen for another two 8 day candles after this one closes in 1d 10 hours.
When the Red RSI fell below 50 in the 2d a downward pressure race was triggered. In order for upward pressure to continue, we first need to see the Energy in the 2d CLOSE above 50 before the Red RSI in the 4d CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4d and the Red RSI in the 8d etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for reversal to upward pressure in the relevant timeframes.
When the Red RSI fell below 50 in the 2d a downward pressure race was triggered. In order for upward pressure to continue, we first need to see the Energy in the 2d CLOSE above 50 before the Red RSI in the 4d CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered. If the Red RSI wins we then have a race between the Energy in the 4d and the Red RSI in the 8d etc. This downward pressure race has cascaded up from lower TFs. Until the Energy decisively wins the race, we do not have a chance for reversal to upward pressure in the relevant timeframes.
As mentioned in previous publications, these markets can change with very little notice. These changes initially manifest themselves in the lower timeframes and propagate up through the timeframes. Nothing is set in stone. Unless you are day trading, you cannot benefit from these early warning signals.
As always - this is not financial advice but just my view of current market dynamics.
One has to be aware that analyses are done on the basis of what the indicators are saying at the time and things can change. It is important to always monitor the scalping group of timeframes as we will see changes propagate up from there.
If you got value from this analysis, please hit the like button
Trade safe
aBL
Note
Just a quick update....Not much has changed; we have just started a new 2 hour candle - the blue LSMA has crossed below level 50 and we are currently trading below the Bollinger Band basis as we would expect. The last couple of times the Blue LSMA crossed below 50 it was brief and quickly crossed back up above 80 on both occasions - in fact it crossed above level 100.
We are always at risk of the BBs expanding as the Blue LSMA crosses below 50 and the price action accelerating to the downside.. However on the last two occasions the Blue LSMA crossed below 50 and returned up above and the Bollinger Bands expanded accelerating the price action to the upside. We have also in this timeframe seen with the start of the new candle, the Red RSI has made contact with the Green EMA as it rises indicating bullish sentiment - we must however consider that until we close like this it is not reliable and also the Energy has become higher than the Green EMA which is bearish. So some mixed signals in this timeframe currently which reflects Bitcoins indecision. We really need to see the outcome of the downward pressure race between the Energy in the 2h and the Red RSI in the 4h.
Currently int the 4h, while the Red RSI and Blue LSMA are above level 50 we can expect the Bollinger Band basis to act as support. This is currently at $131.53 but rising. But consider that they are headed toward level 50 and the Red RSI has crossed bearish below. Also if the downward pressure race is a tie we have to rule in favour of the Red RSI and consider the downward pressure race between the 4h and 8h - we will cross that bridge whe we come to it...
I'll try and continue to post updates if you guys want - if so please hit the like button...
Happy trading!
Note
Update with regard to "downward pressure race" between the Energy in the 2h and the Red RSI in the 4h.At 22:00 the Energy CLOSED above 50 in the 2h before the Red RSI CROSSED below 50 in the 4h. Therefore the Energy won the race providing an initial view of upward pressure continuation. HOWEVER, in order to confirm the victory we needed to see confirmation by the Green EMA in at least the three preceeding halved timeframes being higher than the Energy. Not only is the Energy higher than the Green in the 2h, but it is higher in the 1h and the 30m. So we cannot yet see this as a decisive victory and confirmation of a resumption of sustained upward pressure...
..But, there are some positive signs. The Red RSI in the 2h made contact with the Green EMA as it ascended, indicating upward pressure in this timeframe, the Red RSI also crossed bullish above the Blue LSMA and the Green EMA has gone up quite strongly with the Energy.
In the 4h the Red RSI did actually cross below level 50 but is currently hovering at 49.95.
Technically we have now triggered a downward pressure race between the Energy in the 4h (currently at level 31.95) and the Red RSI in the 8h (currently 80.84). Considering the relative levels and the fact that the Red RSI in the 8h keeps wanting to turn back up, it is my view that the Energy will win this race, indicating a continuation of upward pressure in this timeframe. But we cannot take this for granted until we see it play out. Also we cannot ignore the bearish sentiment indicated by the Energy being higher than the Green EMA in the previous timeframes as discussed. Again on a positive note, we may well see the Red RSI in the 4h bounce back off level 50 as we have on the last two occasions (see magenta circles on the lower pane). Also the Red RSI is currently making contact with the Green as it rises, if we close like this in 90m we can see this as an indication of upward pressure and the Energy will cross above 50 on the next candle.
Indications remain as discussed previously in the higher timeframes.
Note
With regard to the "downward pressure race" I mentioned between the Energy in the 4h and the Red RSI in the 8h, as indicated the Red RSI has already made it up above 50, and the Red RSI in the 8h is still at level 73. However it does look possible that the Energy could still drop below 50 again in the 4h thus re-initiating the race as the Red RSI has dipped a bit further down, but does seem to be starting to turn up. - we will have to wait and see..With current levels of Red RSI and Blue LSMA in 8h we are likely to see the White Upper BB act as support - we may well wick below though - currently at around $140.00. However if the Green EMA drops below 50 we can see the price action find the BB basis act as support while the Red RSI & Blue LSMA remain abobve 50 - current level $125.00 but rising.
Note
Apologies - in the last update I stated:"the Red RSI has already made it up above 50, and the Red RSI in the 8h is still at level 73"
That should have read: "the Energy has already made it up above 50, and the Red RSI in the 8h is still at level 73"
I stated that the Energy could still drop below 50 again thus reinstating the downward pressure race. If you look at the magenta circle you will see this has happened and the Energy is currently at level 46.90. The Red RSI in the 8h hasn't changed considerably being now at 72.73.
In the 2h & the 4h the Energy is higher than the Green EMA indicating bearish sentiment, but not so in the higher timeframes. It is important to remember that such sentiment propagates up through the timeframes. Based on what I'm seeing in the higher timeframes, as previously indicated I believe that this will be a brief period of downward pressure within an overall bearish structure.
Currently in the 2h as the Green EMA is significantly below 50 and the Red RSI and Blue LSMA is below 50; we respect our rule stating that the price action is liekly to reside within the White/Aqua lower BBs for the most part during periods of downward pressure (as denoted by the Energy being below 50) during this period we are likely to see lower lows in the relevant timeframes. Once the Energy returns above 50 we are likely to see the BB basis act as resistance until the Red RSI returns above 50. So for now we can expect support to be found at around the Aqua lower BB at current indicator levels.. (currently $136.78 and falling) We also have to be mindful of the fact that the chances are increased of the BBs begining to expand in the 2h as a result of the Blue LSMA falling below 50 - though no signs yet..
In the 8 hour the Green EMA has fallen just below level 50, if we close below this level in 1h40m and the Red RSI continues its trajectory toward level 50 we are at risk of the price action continuing to the BB basis currently $124.90 but rising.
Note
Firstly - apologies again - Not getting enough sleep!In my last update I stated: "I believe that this will be a brief period of downward pressure within an overall bearish structure"
I meant to say "within an overall "bullish" structure.
So just to update - In the 2h the Red RSI and the Blue LSMA made contact with the Green EMA as it ascended and the white energy has just crossed above 50 indicating upward pressure. Considering the levels of the Red RSI and the Blue LSMA; significantly below 50 and the contracted nature of the BBs we are unlikely to see a significant move in price action and it will be a lower high which will not close above the BB basis until the Red RSI makes it above 50.
Considering the way the Red RSI and the Blue LSMA are continuing together toward level 50 in the 8h we need to carefully monitor the downward pressure race previously discussed between the 4h and 8h
When the Red RSI fell below 50 in the 4h a downward pressure race was triggered. In order for upward pressure to resume, we first need to see the Energy in the daily CLOSE above 50 in the 4h before the Red RSI in the 8h CROSSES below 50. If the Energy does win the race, we need to see the Green MA higher than the Energy in at least the three preceding halved timeframes from the timeframe in which the race was triggered.
This race is now becoming an important factor in determining the next move for Solana.
If the Red RSI does win the race, we can see the price action drop to the vicinity of the BB basis as discussed previously (currently $126.73) and an new race will be triggered between the Energy in the 8h and the Red RSI in the 16h.
We also have a new 4 day and a new 8 day candle starting in 2h 45m which will help shed some light as to the longer term outlook.
Note
The Energy in the 4h won the downward pressure race against the Red RSI in the 8h. This is good news and means we now have a chance to resume sustained upward pressure. The Green EMA in the 4h is currently at the same level as the Energy but is rising strongly and looks like overtaking, this would be an indication of bullish sentiment. In the 2h the Energy still remains higher than the Green EMA, however, the Green EMA is looking like it wants to extend to the side allowing for the Energy to drop below. The Red RSI in the 2h and the 4h has crossed back above 50 and as a result we can expect the Bollinger Band basis to re-establish itself as support. Furthermore, the Blue LSMA is returning toward level 50, if it does cross and continue above 50, the odds of the Bollinger Bands expanding are significantly increased. If this does happen, we have potential for the price action to start accelerating to the upside proportional to the expansion. If we are trading this pair we would be looking for BB expansion moving up from timeframe to timeframe, while it continues to do this we will keep our position open. If we look at the 30m we can see that the Blue LSMA crossed above level 50 at 22:00 and the Bollinger Bands began expanding. We would now want to be looking for the same to occur in the 1h and then the 90m and 2h one by one.Note
I forgot to mention previously in last update.As previously stated, in order to confirm the Energy's victory in the downward pressure race and confirm a conclusive resumption to upward pressure, we needed to see the Green EMA higher than the Energy in the preceding three halved timeframes. As stated, this is not yet the case in the 2h but it can happen, we will need to see how this looks at the start of the next 2 hour candle in just over 1 hour. We have however fulfilled this requirement in the 1h and also the 30m.
A general observation to consider is that upward pressure does not in itself equate to upward price action, but means that we can expect sideways at worst, upwards at best. This is why we want to keep an eye one what the Blue LSMA is doing to try and get an early indication of whether the Bollinger Bands are likely to start expanding. This gives us the ability to decide whether to open positions or to keep positions open. We would be watching for the Bollinger Bands beginning to expand in one timeframe after another and watching the Blue LSMA to ascertain the likelihood of this happening. As we can see this has already happened in the 30m, we need to see if this can happen in the 1h, 90m, 2h, 4h etc. We also want to see the Red RSI remain above level 50 so that we can rely on the BB basis as support. If it does fall below 50 then we are back to downward pressure races..
Note
In the 2D the Energy is currenty at level 58.18. The Red RSI is making contact with the Green as it falls. If we close like this in just under 2 days time, we are at risk of the Energy dropping below 50 indicating downward pressure. We have just started a new 4d candle and considering current Red RSI level at over 100 we know that we can expect upward pressure to continue until the Energy reaches level 50 - judging by the concave shape being formed by the Energy I would expect to see one more 4d candle after the current one before we potentially drop below 50, even then we need to consider that the Energy in the 6d is still at level 80 with the Red RSI just below 100. My guess would be that we still have the remainder of this candle and another 6 day candle before the Energy exhausts and we can start to see downward pressure.Note
Further to last update.I mentioned the Blue LSMA and looking for Bollinger Band expansion in consecutive timeframes.
AS we have seen, this already happened in the 30m also in the 30m we can expect further expansion as the Blue LSMA turns up again and makes contact with the Green EMA and Red RSA as they ascend while above 80. We can also now see that the Blue LSMA has crossed above 50 in the 1h and the BBs have started to expand - the same has happended in the 90m and we can see it just about to happen in the 2h as well.
While the Red RSI and Blue LSMA are above 56 and the Energy is above 50 and the Green EMA is higher than the Energy we can expect the price action to reside with the candle bodies for the most part between the Aqua/Orange upper BB and potentially wicking up to the Red upper BB. But because of the expansion of the BBs we can also expect strong moves as the BBs expand and the candles remain between their bands as described accelerating the price action to the upside. Now all we need to do, as explained earlier is to keep positions open waiting for BB expansion in consecutive TFs. But also we need to look out for signs of reversal.. If we start to see the Red RSI looking like it want's to drop below 50 again, we need to get ready to close positions. We will get early signs of this in the lowest timeframes, propagating up one by one. But also remember that while the Red RSI is above level 56 we are guaranteed upward pressure until the Energy approaches level 50 so we can use this rule to give us confidence in maintaining positions.
To conclude, as per the title, we have now resumed upward pressure after our small dip.
Happy Trading.
Note
As previously mentioned, we are looking for BB expansion to propagate up through the timeframes, following the Blue LSMA crossing above level 50. As also previously mentioned when with the Red RSI and Blue LSMA at these levels above 80 we can expect the price action to accelerate to the upside with the candle bodies residing for the most part between the Aqua/Orange upper BBs as they expand, potentially wicking up to the Red Upper BB. We can now see this begin to happen in the 3h, 4h and the 5hThe Green EMA now remains higher than the Energy in all timeframes reflecting bullish sentimint.
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