With the release of smart contracts on Cardano coming soon it is obvious that the market is going to run, either leading up to the smart contracts release or it will consolidate until the release where it will break out. These theory have been back tested to many times not to be one of the outcomes leading up to this huge news for ADA.
My reasoning behind my statement that ADA has bottomed out is backed by multiple factors of confluence which will be discussed in the following lines ahead.
1) The Golden pocket: This factor is found when using the Fibonacci retracement indicator and is a "pocket" between the 68% and 65% fib. At the moment the price is resting in-between this price and based on other factors of confluence it is more likely to break out to the bulls. Looking at the previous levels that are in the golden pocket make my predications even stronger as it lays above the previous 3 ATM levels of resistance of Feb, March and April as well as a key level of support for the months that followed. It is also important to remember that there is a lot of phycology behind technical analysis, which some don't seem to under stand. before i carry on with confluence 2, i will briefly explain the basics of phycology in the markets.
Phycology plays a key role in the market fluctuations as well as the decision of what indicators or methods of trading your take up. Of course market whales play a big role in the fluctuations of most markets including crypto, but on the other hand you have millions of day traders who trade according to a set of rules and methods of profit making in shorter time frames. So when you trade remember that there are millions of people that all have different rules and techniques BUT all follow a set of indicators and some are associated with each other and therefore millions of retail traders base their decisions on the same indicators and methods which results in a movement in forms of break outs and reversals when prices hit certain levels of a specific indicator you are using or method of trading. Don't think about trading from an individual mindset, think about it as a community of like minded individuals with the same ideas as you, perspectives may change but the goal stays the same and that is to time the market and predict it to a T using a set of rules learnt by millions.
2) The market is currently forming in a bullish pennant formation and has extended to its highest capacity therefore a move is bound to happen very soon if not by the end of the evening. Based on confluence 1 price is more likely to break to the top as support is very strong below the golden pocket. There could be a possibility that the price breaks out to the top but continues a move to the side and consolidates creating stronger support for the current levels following the date of the release of smart contracts which could result in a huge break out as stated in the intro to this article.
3) There is seen to be a pinch between the Bollinger bands and the golden pocket which is a very good sign for a potential break in the days to come.
4) MACD is slowly coming to a halt on the bearish move and is bound to converge bullish in the days to come as the RSI is also under extended and most of the market has bottomed out and is prepared for a move to the bulls following BTCs lead.
There are plenty more factors of confluence that I can discuss but at the time these are my indicators i use the most and form part of my strategy and therefore shall be my key levels of confluence. Give my your perspective on my article and which indicators you use below.
My reasoning behind my statement that ADA has bottomed out is backed by multiple factors of confluence which will be discussed in the following lines ahead.
1) The Golden pocket: This factor is found when using the Fibonacci retracement indicator and is a "pocket" between the 68% and 65% fib. At the moment the price is resting in-between this price and based on other factors of confluence it is more likely to break out to the bulls. Looking at the previous levels that are in the golden pocket make my predications even stronger as it lays above the previous 3 ATM levels of resistance of Feb, March and April as well as a key level of support for the months that followed. It is also important to remember that there is a lot of phycology behind technical analysis, which some don't seem to under stand. before i carry on with confluence 2, i will briefly explain the basics of phycology in the markets.
Phycology plays a key role in the market fluctuations as well as the decision of what indicators or methods of trading your take up. Of course market whales play a big role in the fluctuations of most markets including crypto, but on the other hand you have millions of day traders who trade according to a set of rules and methods of profit making in shorter time frames. So when you trade remember that there are millions of people that all have different rules and techniques BUT all follow a set of indicators and some are associated with each other and therefore millions of retail traders base their decisions on the same indicators and methods which results in a movement in forms of break outs and reversals when prices hit certain levels of a specific indicator you are using or method of trading. Don't think about trading from an individual mindset, think about it as a community of like minded individuals with the same ideas as you, perspectives may change but the goal stays the same and that is to time the market and predict it to a T using a set of rules learnt by millions.
2) The market is currently forming in a bullish pennant formation and has extended to its highest capacity therefore a move is bound to happen very soon if not by the end of the evening. Based on confluence 1 price is more likely to break to the top as support is very strong below the golden pocket. There could be a possibility that the price breaks out to the top but continues a move to the side and consolidates creating stronger support for the current levels following the date of the release of smart contracts which could result in a huge break out as stated in the intro to this article.
3) There is seen to be a pinch between the Bollinger bands and the golden pocket which is a very good sign for a potential break in the days to come.
4) MACD is slowly coming to a halt on the bearish move and is bound to converge bullish in the days to come as the RSI is also under extended and most of the market has bottomed out and is prepared for a move to the bulls following BTCs lead.
There are plenty more factors of confluence that I can discuss but at the time these are my indicators i use the most and form part of my strategy and therefore shall be my key levels of confluence. Give my your perspective on my article and which indicators you use below.