I'm gonna try to keep this as brief as possible while still getting my point across.
If you look at the chart that I've posted, it's pretty obvious what's likely to occur. SPOILER: The trend is likely to continue and here are a few reasons why.
For those reasons, my overall sentiment is bullish, but not at this very moment. I'd like to see how far prices retrace (or if prices retrace) before doing anything.
P.S: What I'm saying may be obvious but I published this idea to refute a few people that I heard recommending going short.
If you look at the chart that I've posted, it's pretty obvious what's likely to occur. SPOILER: The trend is likely to continue and here are a few reasons why.
- Price has just entered a supply zone. But, I wouldn't make too much of this since prices are just now rallying off of the underlying support created by the May and June highs.
- Yes, price has reacted from that supply zone and it may make a great short opportunity for a short-term trade.
- To add even more weight to the bearish picture, prices have also broken through the top of the trend channel — which usually indicates an overbought position.
- What convinces me that we're headed back up is the Fibonacci line. I'm not a fan of the Fibonacci tool but I do believe in the 50% rule. What I mean is that prices have a tendency to retrace 50% of a move until continuing in the prevailing direction. What I see is that the 50% retracement mark is right in-line with a demand zone.
For those reasons, my overall sentiment is bullish, but not at this very moment. I'd like to see how far prices retrace (or if prices retrace) before doing anything.
P.S: What I'm saying may be obvious but I published this idea to refute a few people that I heard recommending going short.
Comment:
I learned a lesson here. As you can see, I completely forgot to mention the major supply zone at the top of the chart — which I'd marked during the original writing. What happened? That's exactly the point at which prices reversed. So, from here, I'm eyeing levels such as 0.907 and 0.90. In the meantime, I'm searching for shorting opportunities.