Chart Observations
Price Action:
Current Price: $2.2190 (down -10.11% for the day).
The price has dropped significantly from $2.3093 (local high) to the current levels, indicating bearish momentum.
Moving Averages (MA):
MA(7) (Yellow): $2.2037 – The price is just above this short-term MA, indicating some buying interest, but still under pressure.
MA(25) (Pink): $2.2332 – Price is under this resistance level, suggesting a bearish trend in the short-term.
MA(99) (Purple): $2.2820 – This long-term MA is acting as resistance, confirming that the overall trend is bearish.
Volume:
Increased volume during the drop suggests strong selling pressure.
The latest volume spike at the current price shows that buyers are stepping in, but this may be a short-term reversal rather than a trend change.
MACD Analysis:
MACD (Differential): -0.0117 (negative), indicating that the bears have control.
DEA (Signal Line): -0.0131 (negative), showing bearish momentum.
MACD Line: 0.0014 (crossing above DEA), showing a potential bullish reversal, but this is only a signal for the short-term, so caution is needed.
Candlestick Pattern:
A Bearish Engulfing pattern is visible, as the red candlestick has engulfed the previous green candle, reinforcing bearish momentum.
Currently, there is a small bullish reversal candle forming, but it's too early to confirm the trend change.
Key Levels
Resistance:
$2.2332 (MA(25), near recent resistance).
$2.3093 (recent high).
$2.2820 (MA(99), longer-term resistance).
Support:
$2.1479 (recent low and key support level).
$2.1556 (short-term support).
Trade Recommendations
1. Short Entry:
Entry: Enter a short trade if the price breaks below $2.1479 (support) and confirms a continuation of the bearish momentum.
Confirmation: A close below $2.1479, coupled with a bearish MACD crossover.
SL (Stop-Loss): Place SL above $2.2190 (recent price level or just above MA(7)).
TP (Take-Profit):
TP1: $2.1556 (near the next resistance level).
TP2: $2.1300 (a larger target based on the current downtrend).
2. Long Entry (Cautious):
Entry: Enter a long position only if the price breaks and holds above $2.2332 (MA(25)), confirming a short-term bullish reversal.
Confirmation: A bullish candle breakout above MA(25) and an increasing MACD crossover.
SL (Stop-Loss): Place SL below $2.1479.
TP (Take-Profit):
TP1: $2.3093 (previous high).
TP2: $2.2820 (MA(99)).
Risk Management
Risk/Reward Ratio: Maintain a minimum 1:2 risk/reward ratio.
Position Sizing: Limit risk per trade to 1-2% of your account balance.
Volume Confirmation: Keep an eye on volume spikes to confirm the strength of breakouts or reversals.
If the price fails to break the resistance or support levels, it may indicate a consolidation or further range-bound movement, and it’s best to stay out of the market.
Trade Duration
This is a 15-minute chart, so you can expect short-term trades lasting from 1 hour to 6 hours depending on the movement.
Monitor market conditions for any signs of trend continuation or reversal for better timing.
Chart Pattern Detection
Bearish Trend: Currently, the market shows a downtrend, with the price consistently below the moving averages.
Possible Reversal: There’s a small bullish candlestick developing, but we need further confirmation for a reversal. If this is a true reversal, it may lead to a retest of resistance levels.
Conclusion
Bearish Bias: The current trend is still mostly bearish, and short positions are preferable below $2.1479.
Bullish Reversal: A break and hold above $2.2332 could signal a short-term reversal, but caution is needed due to the overall downtrend.
Watch for Volume: Volume spikes can indicate the strength of breakouts or reversals, so stay alert for significant changes.
Good luck and trade safely!