Today I want to share an analysis of my recent entry into $PORTAL and how you can use these concepts to improve your own trades.
Yesterday was not the best day, but today I made an excellent entry at $0.03765. If we look at the chart, we can identify several key points that help us understand the price movement:
Overall Bearish Trend: It is crucial to identify the dominant trend. In the case of $PORTAL, the overall trend is bearish. This means that the price, in a wider timeframe, has been decreasing. Recognizing this helps us have a more realistic perspective of the movement.
Narrow Consolidation: After the downtrend, the price entered a phase of narrow consolidation. This indicates a period of indecision in the market where buying and selling pressure is balanced, and the price moves within a limited range.
Channel Formation: Subsequently, a channel was formed. A channel is defined by two parallel lines (one of support and one of resistance) that enclose the price movement. Trading within a channel can offer clear entry and exit points, buying near support and selling near resistance.
Moving Averages (7, 25, 99): The moving averages (MAs) of 7, 25, and 99 periods are currently crossing the chart. When moving averages cross and the price attempts to break above them (especially the longer period ones like the 99), this can indicate a possible trend change or an increase in buying pressure. In this case, the price is 'straining to break' the previous downtrend on a 15-minute timeframe, suggesting an attempt at a short-term reversal.
What does this analysis teach us?
This example of $PORTAL illustrates the importance of combining different technical analysis tools. It is not just about seeing the trend, but about observing how the price interacts with support, resistance, channels, and moving averages.
Key points to remember in your own trading:
Identify the Trend: Always start by understanding the overall trend.
Look for Consolidation Patterns: These can precede significant movements.
Use Channels: Channels provide clear limits for your trades.
Monitor Moving Averages: Crosses and price interaction with the MAs can give you valuable signals.
Confirm in Different Timeframes: Even if you are trading on 15 minutes, it is useful to see what happens in higher timeframes.
I hope this breakdown is useful for your own analyses. Remember that trading carries risks, and it is essential to conduct your own research and risk management.
Success in your trades!
