US30 Bulls Taking Control?!
Weekly Timeframe Analysis
Price Action:
• The weekly timeframe remains in a large uptrend, supported by sloping EMAs. Despite a recent fall, this structure remains intact as prices bounced sharply at 42,000, aligning with the 0.618 Fibonacci retracement of the leg starting on September 9th.
• Importantly, this bounce reclaimed the 20 SMA after dipping below, showing resilience and strength in the trend. Prices remain in the upper band of the Bollinger Bands, a bullish signal.
Trendlines:
• A large lower trendline dating back to October 2023 has held firmly during this fall, reinforcing its significance as a structural support. Higher trendlines are less clear, signaling a potential weakening in momentum on rallies.
Indicators:
• RSI at 57: Above midline but not overbought, showing moderate bullish momentum.
• MACD bearish, histogram waning: Suggests that downward momentum is losing strength, a typical precursor to reversal or consolidation.
• ADX at 19.65: Indicates a lack of strong trend currently, though negative DMI dominance shows residual bearishness.
• Accumulation Distribution Line (ADL): Despite a wick below the 13 EMA, it closed above, with the 13 EMA > 48 SMA, suggesting underlying buying interest.
Daily Timeframe Analysis
Price Action:
• After a long-term rise inside a parallel channel since August, prices broke below this structure on December 16th during the fall.
• The bounce at 42,000 coincided with a daily order block, signaling the level’s importance. This bounce aligns with weekly trendline support and suggests a higher low may be forming, further confirmed by price action breaking back above 20, 50, and 100 EMAs during the recovery.
Fibonacci Levels:
• The daily retracement from the recent fall touched just above the 100% retracement level, showing a deep retracement pattern typical of a sharp corrective phase. Current price action hovers near the 0.5 Fibonacci extension level, facing light resistance.
Indicators:
• RSI at 54: Regained strength above 50, signaling mild bullish momentum.
• MACD green and increasing: While both signal and MACD lines are below zero, the histogram growth reflects recovering momentum.
• CMF at 0.08: Positive, indicating money flow into the asset.
• ADX at 25.78, falling: The lack of strong trend during this bounce indicates it may be corrective unless the momentum picks up.
• ADL dynamics: The ADL line sits above the 13 EMA but below the 48 SMA, reflecting moderate buying pressure without dominance.
Order Blocks:
• Significance: The bounce off the 42,000 daily order block confirms it as a key support level, and prices are now in a second daily order block near 43,500. These zones are critical for observing further price action.
4-Hour Timeframe Analysis
Price Action:
• During the fall, a falling wedge structure dominated, with lower highs and lower lows forming within the descending trendline. This bearish structure broke cleanly, signaling a potential shift to bullish momentum.
• Prices have now moved to 1.23 retracement of the previous high, confirming bullish structure with a break of prior highs. However, a pullback to test support, either at the lower end of the daily order block or trendline, is likely before continuation.
Indicators:
• RSI at 69.97: Near overbought, reflecting strong short-term momentum.
• MACD green but waning: Suggests the upward move may be slowing.
• CMF at 0.21: Strong accumulation, validating the breakout.
• ADX at 32: A rising trend with positive DMI dominance, indicating this move is supported by strength but not yet exhausted.
Volume Profile:
• The POC at 42,410 is a key magnet if prices retrace, with a high-volume node between 42,200 and 43,000, providing structural support for a potential retest.
Custom Indicators
Weekly:
• The first green candle print post-fall indicates renewed strength. The close above the 50 SMA supports the uptrend narrative, making this print significant in confirming higher timeframe bullish momentum.
Daily:
• After a prolonged absence of green candles during the fall, a single green candle print two days ago signals recovery. However, the lack of consecutive green candles tempers the bullish case and calls for caution.
Key Insights
1. Weekly Trend Support: The 0.618 Fibonacci retracement and major trendline at 42,000 align perfectly, making this level critical for sustaining the larger uptrend.
2. Daily Momentum Shift: Recovery of major EMAs (20, 50, 100) and a clean bounce from a daily order block signals that buyers are stepping in at higher levels.
3. Bullish Breakout on 4-Hour: The break of bearish structure is confirmed by strong indicators (RSI, CMF, ADX). However, overbought RSI suggests a pullback may be imminent.
4. Volume Context: The POC at 42,410 and high-volume node below current prices make the 42,200 - 42,500 zone a critical area for buyers to defend on a pullback.
5. Custom Indicators Support Recovery: The green candle prints on the weekly and daily charts bolster the bullish case but highlight the need for sustained momentum.
