Entry Types Simplified: The Essential Guide for New Traders!Key Structures and Formations:
Ascending Channel:
The price has been moving within this channel for a while. An ascending channel indicates an uptrend but also signals that the price is forming higher highs and higher lows, which can later break either direction.
Bull Flag:
A classic continuation pattern where after a strong bullish move (flagpole), the price consolidated before continuing upwards. This was a great entry point for traders watching for bullish momentum.
Failed Flag:
It appears there was a bull flag that failed to continue upwards and instead reversed direction. This type of failure is a strong indication for traders to reconsider their long positions or take partial profits. Often when a flag fails, it can lead to an aggressive move in the opposite direction.
Zones:
4HR, 1HR, 15M LQZ (Liquidity Zones):
These zones mark areas where liquidity is expected to be high, which means these are key levels to watch for price reactions.
The 4HR LQZ around 2,622 and the 1HR LQZ around 2,639 are critical areas for price retracement or reversals, particularly in a trending market.
Current Price Action:
The price is currently hovering near the 15M LQZ (2,655.443), which could act as a short-term support/resistance level. Watching how the price reacts to this zone will provide insight into the next move.
If the price continues to drop, the 1HR LQZ around 2,639 may provide support. If that fails, the next likely target is the 4HR LQZ near 2,622.
Recommendations Based on Confluence:
Check for Multi-Touch Confirmation: If the price interacts with the 4HR or 1HR LQZ zones multiple times and forms a base, this could serve as strong confirmation of a potential reversal or continuation.
Comprehensive Patterns: The failed flag within the larger ascending channel provides a great example of how smaller patterns (failed flag) can give clues about larger moves (channel break).
Follow the Trinity Rule: As per the Trinity Rule, wait for multiple confirmations across different structures before entering a trade. The liquidity zones and patterns within patterns provide a good basis for this.
