OMG is having a lot of good press recently with Vitalik Buterin naming it his favourite cryptocurrency and their new partnership with the government of Thailand. The chart has been showing a nice turnaround this month in the face of a market in turmoil, breaking out from the ascending triangle pattern found at the recent bottom. What followed were a number of micro-bull flags within a larger bull pennant (which may also be a flag, rather than a pennant but the higher lows made me err toward the pennant), which I believe will break out soon.
- Diminishing volume is key confirmation for the pennant form and a spike in volume will indicate an impending breakout.
- Both the 50 and 200 EMA are northbound.
- The RSI and Stoch are at their midpoints, but both show a hidden bullish divergence (it looks smaller here, but on the full-screen indicator it shows up well). The RSI is staying nicely above 40, in accordance with Constance Brown's rule of bullish trends in the Relative Strength Index.
- The MACD is actually bearish right now, however I am largely looking the other way due to its nearing of the 0 line and dwindling bearish momentum.
I am actually not in this trade just yet, rather I am waiting for a confirmation close outside of the pennant. I will consider a close above 210k as confirmation as it will have broken out and formed a higher high.
In the second scenario, we may see a fall to the .682 Fibonacci level before taking off. This would be an excellent buy in area and I include this only as I was almost burned recently by VEN's near-identical setup. Price fell from what I thought was an obviously bullish pennant, down to the previous support area and traded a short channel there before hitting my target. I didn't lose any money as I wasn't in the trade, but in moving on before reevaluating the chart, I definitely missed a trick there!
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This is not financial advice guys, I'm just a hobbyist! Any and all risk you take is 100% on you!
Good luck!
- Diminishing volume is key confirmation for the pennant form and a spike in volume will indicate an impending breakout.
- Both the 50 and 200 EMA are northbound.
- The RSI and Stoch are at their midpoints, but both show a hidden bullish divergence (it looks smaller here, but on the full-screen indicator it shows up well). The RSI is staying nicely above 40, in accordance with Constance Brown's rule of bullish trends in the Relative Strength Index.
- The MACD is actually bearish right now, however I am largely looking the other way due to its nearing of the 0 line and dwindling bearish momentum.
I am actually not in this trade just yet, rather I am waiting for a confirmation close outside of the pennant. I will consider a close above 210k as confirmation as it will have broken out and formed a higher high.
In the second scenario, we may see a fall to the .682 Fibonacci level before taking off. This would be an excellent buy in area and I include this only as I was almost burned recently by VEN's near-identical setup. Price fell from what I thought was an obviously bullish pennant, down to the previous support area and traded a short channel there before hitting my target. I didn't lose any money as I wasn't in the trade, but in moving on before reevaluating the chart, I definitely missed a trick there!
-----
This is not financial advice guys, I'm just a hobbyist! Any and all risk you take is 100% on you!
Good luck!