I have been trading this bullish fractal since first noticed on the 16th of July and have just closed 95% of my shorts from 11,077 for >1000% ROI (Bitmex and Deribit). I have started opening longs from 9650; and still have buy orders placed as low as 9460 in various intervals; though I believe we might only go down as far as the green support line at 9560. I have my stop loss set at 9420 and if we reach this level then the idea is invalidated and we are likely following the red arrow path. If this occurs, I will wait for the retest of the green support line as new resistance before shorting.
90% of the time however, this pattern plays out in a bullish fashion. Considering this I see two potential paths. The first is the yellow path which takes us to the strong resistance formed by the diamond top - if we hit around near where I have the exclamation mark, then this is the double touch of the diamond resistance I have been waiting for. This would be a strong short call.
The second path (and potentially more likely path) is the green path. This takes us up to the very top purple dashed resistance which would represent a double top of the long term down trend channel. It is worth noting, that so many people on here are saying we have already had a double top; but this is simply not true. The high on 10th of July did not reach the dashed line and hence it does not represent a double top like so many say it does. If we hit this it will likely confluence with the diamond top reversal pattern red resistance line and would be a super strong short call.
How I am trading this - Longs are already in play from 9650. Further longs are laddered down to 9460. If we fall to the stop loss at 9420 then I will wait for a retest of the green support as resistance and then go short. I am looking for a break out of the small green descending wedge and subsequent blue dotted large descending wedge. The candle I am expecting should take us almost straight up to the low 11,100's and should occur within the next 48 hours. If we see this candle, we will likely fall back down to retest the blue dotted descending wedge resistance as support before climbing higher via the yellow or green path.
90% of the time however, this pattern plays out in a bullish fashion. Considering this I see two potential paths. The first is the yellow path which takes us to the strong resistance formed by the diamond top - if we hit around near where I have the exclamation mark, then this is the double touch of the diamond resistance I have been waiting for. This would be a strong short call.
The second path (and potentially more likely path) is the green path. This takes us up to the very top purple dashed resistance which would represent a double top of the long term down trend channel. It is worth noting, that so many people on here are saying we have already had a double top; but this is simply not true. The high on 10th of July did not reach the dashed line and hence it does not represent a double top like so many say it does. If we hit this it will likely confluence with the diamond top reversal pattern red resistance line and would be a super strong short call.
How I am trading this - Longs are already in play from 9650. Further longs are laddered down to 9460. If we fall to the stop loss at 9420 then I will wait for a retest of the green support as resistance and then go short. I am looking for a break out of the small green descending wedge and subsequent blue dotted large descending wedge. The candle I am expecting should take us almost straight up to the low 11,100's and should occur within the next 48 hours. If we see this candle, we will likely fall back down to retest the blue dotted descending wedge resistance as support before climbing higher via the yellow or green path.
Comment:
There is a chance we could range within the blue box for the next day or so, before moving up. Just something to be aware of; though I think we move up sooner. Stop losses are still in place in case of a move below 9420. My Average long entry price: $9629. Target for this analysis is $11,100. At which point I will re-do based on the latest information.
Comment:
We have met resistance of 100MA/200MA. We could potentially burst through, however it is more likely we cool off over the coming hours and test the 50 MA as new support (around 9550ish). We will also have the following fib level EMA's 5/8/13/21/55 confluencing at the same value. Stops have been moved into slight profit at $9729 from $9629 average entry.
Comment:
Edit: Value in parenthesis should read 9950ish and not 9550ish.
Comment:
Updated idea to be published shortly.
