## Market Analysis
NEO has recently shown significant upward movement but is now encountering strong resistance at the $5.68 level. The price action exhibits classic signs of exhaustion with decreasing buying volume after a steep climb. The current 1-hour chart shows a potential reversal pattern forming, making this an optimal entry for a short position.
## Technical Indicators
- **RSI (Relative Strength Index)**: Currently in overbought territory at 79.28, signaling potential reversal
- **Volume Profile**: Declining buying pressure at current price levels
- **Market Sentiment**: Fear & Greed Index at 25 (Extreme Fear) - contrarian indicator supporting potential downside
- **Risk/Reward Assessment**: Favorable at 2.2 for the primary target
## Entry Strategy
Our algorithm identifies an ideal entry at $5.60, with consideration for slippage and fees. The NEO price has shown resistance to break above $5.68 with multiple rejections, strengthening our conviction for this short position.
## Risk Management
- **Stop Loss**: $5.74 (2.40% from entry)
- **Position Sizing**: Recommend risking no more than 2% of total capital
- **Exit Strategy**:
- Target 1: $5.38 (+3.89%) - Close 50% of position
- Target 2: $5.05 (+9.84%) - Close 30% of position
- Target 3: $4.75 (+15.11%) - Close remaining 20%
## Supporting Evidence
The recent price action shows a parabolic move that typically doesn't sustain. Additionally, the 1-hour chart displays potential bearish divergence between price and momentum indicators. Current ATR of 0.0841 (1.50%) suggests manageable volatility for this trade setup.
Remember to adhere strictly to the risk management rules outlined above. This setup offers an excellent risk-to-reward opportunity, but proper position sizing remains crucial for long-term trading success.
NEO has recently shown significant upward movement but is now encountering strong resistance at the $5.68 level. The price action exhibits classic signs of exhaustion with decreasing buying volume after a steep climb. The current 1-hour chart shows a potential reversal pattern forming, making this an optimal entry for a short position.
## Technical Indicators
- **RSI (Relative Strength Index)**: Currently in overbought territory at 79.28, signaling potential reversal
- **Volume Profile**: Declining buying pressure at current price levels
- **Market Sentiment**: Fear & Greed Index at 25 (Extreme Fear) - contrarian indicator supporting potential downside
- **Risk/Reward Assessment**: Favorable at 2.2 for the primary target
## Entry Strategy
Our algorithm identifies an ideal entry at $5.60, with consideration for slippage and fees. The NEO price has shown resistance to break above $5.68 with multiple rejections, strengthening our conviction for this short position.
## Risk Management
- **Stop Loss**: $5.74 (2.40% from entry)
- **Position Sizing**: Recommend risking no more than 2% of total capital
- **Exit Strategy**:
- Target 1: $5.38 (+3.89%) - Close 50% of position
- Target 2: $5.05 (+9.84%) - Close 30% of position
- Target 3: $4.75 (+15.11%) - Close remaining 20%
## Supporting Evidence
The recent price action shows a parabolic move that typically doesn't sustain. Additionally, the 1-hour chart displays potential bearish divergence between price and momentum indicators. Current ATR of 0.0841 (1.50%) suggests manageable volatility for this trade setup.
Remember to adhere strictly to the risk management rules outlined above. This setup offers an excellent risk-to-reward opportunity, but proper position sizing remains crucial for long-term trading success.
Note
1% ...Trade active
1% loadedTrade closed: target reached
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.