XLMBTC Cup and Handle formation
Updated
Here we have a chart playing out which satisfies many (if not all) of the requirements of a Cup and Handle formation.
First we see that there was the beginning of an upward trend prior to the left "rim" of the cup being formed.
Next we would expect the cup height to be between 1/3 and 2/3 the height of the prior upward movement and this chart measures within these boundaries.
Third we see the completion of the "cup" pattern with a height of 1041 sats. From here the formation of the handle begins and we can calculate the approximate support level or floor of the handle by expecting a retracement of 1/3 of the gain made on the right side of the cup.
1/3 of the gain on the right half of the cup ends up calculating as a retracement of 271 satoshi / a projected support level of 659 sats. This target was reached and support was confirmed.
Now we are expecting XLM to consolidate and trade horizontally until new traders enter and most weak hands have made their exit. After the resistance levels noted on the chart are tested and we find that breakout is successful, the initial target is 1280 sats.
Resistance at this level is likely. If momentum is strong and this boundary is passed the next should be old support levels between 1409 and 1600 sats.
Finally, a price of 2800 sats will show the completion of a second (larger) cup formation. This level is most likely unrealistically far away at this point and isn't a target of this analysis. But it's something that I noticed and am interested to look out for in the future.
This analysis is to be used for conversation and debate. I am not a professional financial analyst and this should not be considered financial advice.*
If you have anything else to add or can offer constructive criticism I would really appreciate your input. Thanks for thinking about this chart with me!
- Van
First we see that there was the beginning of an upward trend prior to the left "rim" of the cup being formed.
Next we would expect the cup height to be between 1/3 and 2/3 the height of the prior upward movement and this chart measures within these boundaries.
Third we see the completion of the "cup" pattern with a height of 1041 sats. From here the formation of the handle begins and we can calculate the approximate support level or floor of the handle by expecting a retracement of 1/3 of the gain made on the right side of the cup.
1/3 of the gain on the right half of the cup ends up calculating as a retracement of 271 satoshi / a projected support level of 659 sats. This target was reached and support was confirmed.
Now we are expecting XLM to consolidate and trade horizontally until new traders enter and most weak hands have made their exit. After the resistance levels noted on the chart are tested and we find that breakout is successful, the initial target is 1280 sats.
Resistance at this level is likely. If momentum is strong and this boundary is passed the next should be old support levels between 1409 and 1600 sats.
Finally, a price of 2800 sats will show the completion of a second (larger) cup formation. This level is most likely unrealistically far away at this point and isn't a target of this analysis. But it's something that I noticed and am interested to look out for in the future.
This analysis is to be used for conversation and debate. I am not a professional financial analyst and this should not be considered financial advice.*
If you have anything else to add or can offer constructive criticism I would really appreciate your input. Thanks for thinking about this chart with me!
- Van
Note
Interesting to see the Handle forming nicely. It's curvurature is more apparent on a 30 minute chart. I can see that the balance here is being maintained by a very narrow band of large Bids and Asks that are almost acting as a stylus by which the chart is directed. The random-ish assertions of our collective conscious appear to be guiding the markets price-action...
I guess that's what the whole "TA" theory is about, right?
Note
Looking at the chart now, it seems that the formation has completed and didn't have the required volume to break through the sell walls. I'm not sure if this means we are in a consolidation period or if we need to be looking for a new analysis and to ignore the possibly failed Cup and Handle formation.If there weren't so many bears putting up such huge sell orders, this coin would probably be sitting at 1500 Satoshi right now.
Note
It's also possible that a much smaller cup and handle are in the process of forming and we are at the apex of the base of the second handle. You can see it to the right of this chart. The "Handle" of this analysis can be seen as a new "Cup". I need to take measurements and check out additional variables to confirm if this handle conforms to the requirements of a C and H.
That would make this the third and smallest C and H on the XLM chart.
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