After continuous observation of the market and data analysis, we are currently facing a complex structural adjustment phase, primarily due to the contradictions between various trading cycles. Against this backdrop, both bullish and bearish investors hold their respective expectations.
On the hourly timeframe, the bearish structure dominates. In Area A, we marked the selling zone and suggest investors look for buying points on the right side. When the price breaks through the recent high, it will be a potential entry opportunity. However, considering that the current risk-reward ratio is not ideal, we will not consider this strategy for now. If Area A is breached, we will look for bearish opportunities at a higher level. But it should be noted that for most non-breakout scenarios, unless there is a clear breakout at the larger cycle (such as the 10.8k level), we will remain cautious.
In Area B, we observed buy zone signals, where light position left-side trades can be considered. When the price declines and breaks through the previous low, it will signal an exit. Although this is a counter-trend operation on the hourly level, due to its potential high risk-reward ratio, investors with lower risk tolerance may attempt light position trading.
For Area C, the trigger for buying conditions is a break of the previous low. Once this condition is met, the next potential buying point will appear in Area C.
It should be emphasized that the 10.8k level does not indicate that the larger cycle bullish trend will directly reverse. Currently, it is uncertain how far the hourly bearish trend will extend in the future, and we can only rely on expectations to make judgments. However, it can be confirmed that when the hourly bearish trend ends, the market may conduct a second probe of the previous high in the larger cycle or continue to develop the bullish trend of the larger cycle. Therefore, at this stage, we are not inclined to consider the possibility of a reversal in the larger cycle.
