CONFLUENCE.
The Profitable and Less risky method to trade.
Today we are going to talk about what's known as Trading with Confluence. But before we go there, I want to congratulate those who read the analysis for today for Sui/usdt. I posted analysis predicting the shorting of Sui. And as you can see on the picture below. It's going down.
Back to the topic, what confluence?
It refers to the coming together or convergence of multiple technical analysis factors or signals at a specific price level on a chart. Traders often look for confluence as it can enhance the strength and reliability of a trading decision. The idea is that when multiple indicators or analysis methods align at a particular point, it may increase the likelihood of a significant price reaction or trend reversal.
My strategy as Crypto Dragon, i look for atleast 4 points of confluence but preferably 5. Each point is 20%. If i get 4 points, thats 80% level of confidence. 5 points are my perfect trades(100% confidence) putting other factors constant.
Let me break down the points of confluence for sui/usdt that i used.
point 1: Its an uptrend, therefore i expect a retracement back to the trend line.
2. The price is on the upper side of Bollinger band, hence its overbought i expect it to come back to the middle line.
3. RSI is 70, this is considered over-bought.
4. Head and shoulder pattern forming, this is a reversal pattern.
5. According to SUi Fibonacci extension shown in the picture below, Sui has already fulfilled the measured move of 1.618(1.4112) price target. Usually, the second leg is terminated at 1.618 Fibonachi, so if it's above that, it stresses the point that the coin is over-bought, it has to come done soon.
As you can see all 5 analysis indicators are pointing to one truth, SHORT THIS DAMN COIN!
That's when you enter for a short position. See this strategy isn't perfect but it has a high probability since all different TA indicators are agreeing. In trading, that's what we call POINT OF CONFLUENCE.
NO WONDER, THIS SIGNAL WAS RIGHT, SUI IS GOING DOWN NOW!.
Crypto Dragon
