🔍 Principle:
The smart trader does not wait for news or delayed analyses, but reads market signals themselves. The true top or bottom often appears before the reversal through changes in price behavior and liquidity.
📊 Tools used:
• Volume Profile: Identifies areas of liquidity accumulation or distribution.
• Candlestick Patterns: The appearance of candles like 'Pin Bar' or 'Engulfing' at strong support/resistance areas.
• RSI Extreme Zones: RSI reaching above 80 or below 20 with a reversal signal.
• OBV (On Balance Volume): Indicates whether the movement is supported by real or illusory liquidity flow.
📌 Action plan:
1. Identify the main support and resistance areas on the 4-hour and daily time frames on the chart.
2. Monitor trading volume as the price approaches them—weak volume with continued movement indicates a potential reversal.
3. Pay attention to reversal candlestick patterns, especially if they appear with divergence on RSI or MACD.
4. Do not enter until the signal is confirmed with a complete candle, and do not rely on a single indicator.
💡 Practical example:
ETH is approaching $4,000, showing negative divergence on RSI, a bearish Pin Bar candle at resistance, and declining trading volume → this is a strong signal for the potential beginning of a top and a downward reversal.
🚀 Next step: Open the chart, try integrating Volume Profile with RSI, and start mapping liquidity areas. The more you practice, the easier and more accurate reading tops and bottoms becomes, and this is the secret to professional profits 💰🔥
