The history of $ETH and these stretched Daily divergences
1. Failure, continuation of trend, -38%
2. Bounce time, squeeze hard to the upside, +100%
3. Loss of major support level spanning 14 months, ?%
Reclaim support + playout increases
Reject as resistance - playout increases
1. Failure, continuation of trend, -38%
2. Bounce time, squeeze hard to the upside, +100%
3. Loss of major support level spanning 14 months, ?%
Reclaim support + playout increases
Reject as resistance - playout increases
We have similarities with both divergences. Strong trends, tightening in this sell off structure.
We also have a very helpful signal with this $1700 support/potential resistance.
Without a successful reclaim PA probably ends up looking like 2016.
We also have a very helpful signal with this $1700 support/potential resistance.
Without a successful reclaim PA probably ends up looking like 2016.
I'm happy taking shots with Calls on the assumption the divergence does maintain structure and we do see a rally, however I can't touch spot or perps, just one gamble to try and see a trade through until July with risk defined and no need to monitor
Add more if $1700 is claimed
Add more if $1700 is claimed
Further points before I head to bed. I don't think this is ever a trade you need to be 100% positioned for until you get further strength signals.
You've got great triple confluence if you're patient enough.
1. Reclaim of support
2. Break of diagonal
3. Bull div
You've got great triple confluence if you're patient enough.
1. Reclaim of support
2. Break of diagonal
3. Bull div
There's nothing wrong with waiting until all 3 are present (if) before positioning. Sacrifice the "bottom" entry for strength.
The upside is probably $2200-2400 environment dependent. So the value is there.
Protection is still the priority, the trend is strong.
The upside is probably $2200-2400 environment dependent. So the value is there.
Protection is still the priority, the trend is strong.
I've seen thousands of divergences like this across timeframes and unfortunately I can't provide any clear strength or weakness arguments in isolation.
I can however utilise the other factors (S/R) to increase/decrease the chance of a playout.
I can however utilise the other factors (S/R) to increase/decrease the chance of a playout.
When we're looking to play divs we're typically always counter-trend. In this situation we're counter-trend every single timeframe and outlook (worst situation)
With that we need to appreciate and give credit to the downtrend over anything else.
With that we need to appreciate and give credit to the downtrend over anything else.
We assume from self-preservation that the divergence fails when we give credit to the strength of the macro trend.
We allow the market to provide us with enough evidence that our assumption may be incorrect or indeed that it is correct.
We position accordingly.
We allow the market to provide us with enough evidence that our assumption may be incorrect or indeed that it is correct.
We position accordingly.
Final clarification point.
If we get a bounce from here and we do put in a low. For me it will just be another bear market rally that I will look to position short on when it overextends and exhausts.
It's not enough to change the macro picture from my perspective.
If we get a bounce from here and we do put in a low. For me it will just be another bear market rally that I will look to position short on when it overextends and exhausts.
It's not enough to change the macro picture from my perspective.
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