Long

AVAX - interesting situation

By Trendoscope

Updated

Really interesting scenario where hourly timeframe has complete opposite trend of daily

If you look at hourly chart,

Clear visible downtrend channel
Price is just below upper trendline of downtrend channel
Multiple bearish patterns suggesting downward price movement

If you look at daily chart,

Clear visible uptrend channel
Price just above lower trendline of uptrend channel
Multiple bullish patterns suggesting upward price movement.

How to play

Go short based on lower timeframe.
Wait for price to hit 79.80 which is target level based on multiple patterns and support line. Daily timeframe stoploss is around 78. Hence, this can be perfect reversal zone. Go long based on HTF once you take profit.
Stop loss around 95.5 - If you hit stoploss shift to long trade based on HTF.
Note that higher time frame position means wider stoploss - may need to adjust the risk accordingly.

Scenarios

Best case : Short position hits take profit level at 79.8 and price reverse to resume daily uptrend.
Worst case : Hit short position stop 95.5 and then go on to hit long position stop at 78.8

Lets see how this plays. I am going with a small risk.

Note

Low of 80 is hit and I will take it :)

Note

Stop-loss for long position updated to 92.5

Note

Stop hit on 92.5 - but with this both short and long trades ended up as success.

Equation is still the same. We can attempt another long trade as both daily and hourly are near supporting trendline.

SL: 88
TP1: 96
TP2: 100

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