How to use SqueezeMomentum, WT Oscillator Indicators
In the 1-hr we have Squeeze Momentum green fading and the green bars have turned gray. This suggests price may have topped and is a warning to close longs. When the bars fall to centerline, dots change color from dark to light blue, is a signal to enter short side. You can aggressively enter shorts earlier based on chart formations, other signals such as RSI overbought, or gestalt hunch, but risk is higher, as another rising price can still occur in this area.
No signal yet on WaveTrend Oscillator, short signal is generated when it gives a red button.
RSI way overbought, but can still pop higher and get more so. IMO this is a less predictive indicator, as it can stay overbought in melt-up like this.
Volume price indicator shows Point of Control at yellow line. Price often returns to POC on pullbacks, making it a target for shorts.
Not advice, just ideas for some indicators that are very useful IMO. GLTA!
No signal yet on WaveTrend Oscillator, short signal is generated when it gives a red button.
RSI way overbought, but can still pop higher and get more so. IMO this is a less predictive indicator, as it can stay overbought in melt-up like this.
Volume price indicator shows Point of Control at yellow line. Price often returns to POC on pullbacks, making it a target for shorts.
Not advice, just ideas for some indicators that are very useful IMO. GLTA!
Comment:
Forgot to mention MA 50, notice price trades far above the 50-day moving average, another indication that reversion may occur soon.
Using all these tools in combination will give you an edge and hopefully keep you out of wrong-side trades!
Using all these tools in combination will give you an edge and hopefully keep you out of wrong-side trades!
Comment:
People ask, 'when should I buy or sell short?" As recent price action proves, you cannot base short or long entries purely on price, being 'too high' or 'too low'; these are subjective impressions and price is driven by demand. When supply accumulates and demand is exhausted, price will fall. When supply is sold out and demand is coiled up, price will jump, and suddenly as we saw 14 October. Often the beginning of a bull run like this one is an Initiation Gap Up, which most often will not fill, at least not right away. The end of a rally is often marked by an Exhaustion Gap, which fades quickly, as the gap we saw today (11/04), this might signal end of rally, or there might be another last gap remaining. Indicators will signal when the rally is over, watch them closely, do not try to guess entry timing, it gets expensive real fast! GLTA!
RSI jumped then but you can see how it lags the others, less useful for entries, but very helpful to see when price is oversold or overbought.
On the right side of chart, PriceVolume bars show how little volume is trading at the high prices. Few buyers up in the nosebleed zone, makes you cautious about entering longs up there! Reversion to the POC is likely to occur soon when volume fades like this.
What wonderful tools... happy trading!