📘 Lesson 3: How do we read reversal signals using moving averages? 🧠
👋 For beginners: This lesson will help you read the chart and identify the beginning of a trend reversal.
💡 What do we see in the $DOGE chart?
Timeframe: 15 minutes
Current price: $0.19244
Overall trend: Down
Last bottom: 0.18555
Indicators used:
🔹 MA 5 (Yellow) – Fast
🔹 MA 10 (Pink) – Average
🔹 MA 25 (Purple) – Slow
📈 Signals from the chart:
1. The previous decline is evident from the downward slope of the moving averages.
2. The price started to bounce from a strong support level at $0.18555.
3. The MA(5) crossing above MA(10) = an early signal of a potential reversal.
4. But the price is still below MA(25) = the downtrend has not been fully broken yet.
📊 What do we learn from this?
Do not enter a buy immediately at the first bounce!
Wait until the price breaks above the long MA (e.g., MA25) and holds above it.
Use supports and resistances as confirmation tools.
✅ Summary:
> If you see the price bouncing from a strong bottom
And the short moving averages started to cross upwards.
So wait for the long MA breakout to enter.
