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Divergence

NAS100 ReversalNAS has been falling in the past several sessions. On the chart , the fib levels are drawn from the recent past swing high to the swing low. An anchored VWAP is set at the swing high. Price is currently just above the VWAP and the 0.5 Fib level. These are both likely support for a reversal. I will look for volatility and enter a long trade upon confirmation. MACD and RSI are both showing bullish divergence ( Stop loss at the fib level below the entry. Frist target is the upper band of the VWAP and final target is the red line horizontal resistance)
NLong
by AwesomeAvani
US30 - Breakout SetupUS30 has been in a bullish trend on 1H. Price has recently bounced off an important Resistance Zone that may caused a trend reversal. The Bearish Bias is based on the following confluence: Price has stopped making HHs and HLs Resistance Zone (1W, 1D, 4H, 1H) rejection Horizontal Support breakout with Bullish Engulfing candle Rising support breakout with Bullish Engulfing candle Bearish Divergence on RSI (1D, 4H, 1H) OBV Divergence (1D, 4H) Trade safe. Hit like & follow for more analysis.
UShort
by yo_zubair
FTM/USDT4H Timeframe shows us a classic bearish divergence => For taking a short position I wanna see an extended bearish divergence, it's because we can see it more often while spotting the trend reverse ( wave 3 and wave 4 make classic bearish divergence, BUT then the wave 5 making a higher high and taking the stop loss liquidity of the waves 3 and 4, after that we can see an extended divergence) ! In between the waves 3,4 and the wave 5 usually there is a hidden bullish divergence! On our FTM USDT chart we could notice a bearish divergence but it didn't go well, because MACD histogram did lower low while the chart was making higher high in the up trend, so it's a very nice bullish signal for taking a BUY position. If you missed it, no worries, just wait for the extended bearish divergence and go short!
F
by STUKOVA
3
A glitch in the energy matrix?Something weird is bubbling in the energy space. Before we delve in, let us briefly explain what the S&P Energy Select Sector Index represents. Some of you might already be familiar with XLE, the ETF which tracks the S&P Energy Select Sector Index (IXE). This Index seeks to represent the Energy sector by aggregating a basket of names in the sector. A breakdown of the top 10 Index components shows the Oil & Gas majors taking up roughly 75.41% of the Index, and 91% of the total Index component being Oil & Gas exposure, while the other 9% being energy-related equipment and services. CME E-mini S&P Select Sector Futures, XAE, tracks the aforementioned energy index, with the added benefit of margin offset and deep liquidity. Now given that the S&P Energy Select Sector Index is made up of mostly big Oil & Gas names, we would expect some correlation between the prices of oil and the Index itself. A look at both from the depths of the low in March 2020 till now shows both products moving closely together up until recently, where zooming in we see… the glitch in the matrix.... The 2 have been trading generally in lockstep since the bottom in 2020, but have diverged in a peculiar fashion, since the middle of July, with the energy sector gaining roughly 28% since, while Oil tumbles close to 30%! Has the exuberance in energy stocks been overdone? In our opinion yes and we see a couple of headwinds for the Energy Sector in general: 1) The impressive rally from the depths of COVID has been driven by rising oil prices and share buybacks. Oil prices are now faltering, and tightening Financial conditions/Recession could slow or stop buybacks. 2) Political pressure to apply a ‘windfall tax’ on oil and gas companies could eat into energy companies’ earnings. 3) Stabilized tension from the Russian-Ukraine means lower uncertainty and pressure on oil prices, as supply and demand find equilibrium from alternative sources. 4) China’s continued zero COVID policy means low demand from the world’s largest importer. From a price action perspective, XAE is trading just slightly off the all-time high range, which could prove to be an area of resistance. All things considered, we think this presents an opportunity to trade this divergence either by; 1) Shorting the XAE outright, which means to take a directional view on the Energy Index. A riskier trade. 2) Pair the XAE with the Crude Oil contract, by shorting the XAE and taking a long on the Crude Oil contract. A more risk-controlled approach. Crude Oil Trades at a contract unit of 1000 barrels and the E-mini Energy Select Sector trades $100 x S&P Energy Select Sector Index. Each Index point is 100$ on the CME E-Mini Energy Select Sector Futures contract (XAE) and $1000 on the Crude Oil Futures. One way to construct this spread could be to calculate the contract value difference between the 2 products; Spread = 100 x XAE1! – 1000 x CL1! You can construct the chart on TradingView by typing the above into the product search bar. This will show the Chart of the spread between the 2 products, which is close to the all-time high now. As such we will lean on the short side of this spread, given the outperformance of the Energy Index relative to Crude Oil. We will also keep an eye on the upcoming OPEC meeting on December 4th to gauge the path forward for Oil Prices. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Sources: www.cmegroup.com www.cmegroup.com www.cmegroup.com www.ssga.com oilprice.com
CME_MINI:XAE1!Short
by inspirante
16
TSLA - due for a bounce soonTSLA is now at a longer term horizontal support zone (168-180), after having retraced 61.8% of it's major AB upswing that had begun in March 2020(see monthly chart). A short term bounce looks to be due as we are now seeing a bullish divergence between price and RSI on it's daily chart, but whether this is "THE" low remains to be seen as the overall trend is still down at the moment. Having said that, the chance that it is bottoming is higher should we start seeing more of the FAANG stocks pivoting. Can only wait and see. Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is important! Take care and Good Luck!
NASDAQ:TSLA
by Juliac
4
DJI/ SPX - expect near term volatilityWith FOMC uncertainty coming up this week, and the indices hitting into near term trendline resistence, some volatility will not be surprising in the next few days. Among the 3 indices, DJI has been the strongest of late. On the monthly timeframe, we can see a few rather bullish signs: 1. a "tweezer bottoms" 2. bullish engulfing candlestick 3. bullish divergence between price and RSI playing out. However, divergences usually translate into just a short term reversal (lasting 1-3 candlesticks) and may not be a longer term trend reversal. Still, when seen on a monthly chart, this could mean 1-3 months of "upside"). A pullback at this junction is not unexpected but what is important is to watch for the amount of pullback. Any pullback that within 50% fibonacci retracement of it's recent strong upswing AB is within "acceptable" limits. However, anything is possible. Let's see how it will play out this week especially after FOMC this Wednesday. Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is important! Take care and Good Luck!
TVC:DJI
by Juliac
11
Sell the news ? banksters overbought BTC before CME, what now ? comments under the first chart : BTCUSD As stated on "some grey eminences making too much money" I d just say "some banksters got in BTC, and they overbought, too much. now they will give the option to their customers. www.coindesk.com Banksters are well know to bet against their customers . . . the next few days could bring surprises. My personal chart ( uk.tradingview.com ) , with personal god mode settings, is shouting "WARNING" : I m not telling anyone to short bitcoin, shorting bitcoin is dangerous . . . but . . . perhaps you want to reduce your exposure, have some fiat and serious altcoins ( ZEC is a good bet imo ) ready to rebuy BTC lower ( targets : 16k, 12k , 8500 here )
B
by neofutur
68
Resistance Levels Where AMD Could Fail in a Bear RallyPrimary Chart: Bollinger Bands (Yellow Shaded Volatility Channel) with Fibonacci Levels, Downward TL and VWAPs 1. As discussed earlier this month, AMD remains in a severe downtrend at the primary degree of trend. This means that the path of least resistance on higher time frames remains lower unless and until AMD can do a substantial amount of price work and recover into the mid $80s (the area of the downward trendline shown on the Primary Chart) and preferably the $100.60 level (the .50 retracement of the 2020-2022 rally). Supplementary Chart A: AMD's Linear Regression Channel Reflects Severe Downtrend 2. In every trend, however, corrective retracements and mean reversions will occur. In a downtrend, market participants commonly attempt to pick bottoms especially in former market leaders and darlings—and when this bottom-picking is combined with heavy short positioning that requires covering when major downside moves exhaust, ferocious bear rallies ensue. On October 11, 2022, SquishTrade prepared the following chart showing some of the powerful bear rallies that have occurred since November 30, 2022 (all-time high date): Supplementary Chart B: Percentage Gains for Bear Rallies in AMD Since All-Time High 3. The VWAP anchored to the all-time high on November 30, 2022, shown on the Primary Chart, reveals that the downtrend at the primary degree of trend remains in effect. The lower highs and lower lows on daily and weekly charts support this conclusion, and the downward trendline—also shown on the Primary Chart in orange—has not been broken. Price remains significantly below both the orange downward TL and the all-time-high VWAP, showing the profound weakness in this former market leader. 4. Price has even fallen beneath the April 2018 anchored VWAP (shown in red on the Primary Chart above) having a price value of $61.95 on October 20, 2022. AMD's rapid decline since August 4, 2022 peaks appears to have stalled just after breaking below this VWAP. This 4.5 year VWAP provides strong near-term resistance at $61.95. This level of interest should be monitored during any bear rally and on any subsequent decline. Price may rally and whipsaw above it during a mean reversion only to fail and slice back below it. 5. Price has fallen beneath the .786 and .618 retracements of the entire rally from the Covid 2020 lows. These levels are at $64.08 and $85.54 respectively. This is significant because it reflects the strength of this downtrend. Any bear rally will meet strong resistance when rising back to these levels. Before considering these levels as resistance however, price must first break above the April 2018 VWAP (about $61-$62), and the 21-day EMA at about $63.31 as of October 20, 2022. Until the 21-day EMA and the April 2018 VWAP are reclaimed ($61-$63 approximately, the higher retracement levels remain irrelevant. 6. Some evidence of downside exhaustion appears on AMD's charts. These suggest that a short-covering and FOMO-driven rally may occur in the coming weeks between now and year end. SquishTrade hinted at this possibility recently with the following chart, showing how AMD was approaching the bottom of its downtrend channel: Supplementary Chart C: October 11, 2022, Post Showing Higher Risk For Shorts Near Downtrend-Channel Support 7. On AMD's daily chart, RSI now shows a positive divergence despite price making lower lows. This is further evidence that shorts should be cautious and wary of a bear rally or, at a minimum, choppy action over the next few weeks. Supplementary Chart D: RSI Positive Divergence on Daily Chart 8. The Bollinger Bands also suggest that the downward price move from August 4, 2022, swing highs may be nearing exhaustion. Note how the bands (set at two standard deviations) are contracting now, which suggests either chop or mean reversion in the coming days or weeks. The %B indicator in the subgraph also shows weakening downside price action. As price made lower lows over the past two months, the %B indicator made higher lows. This reflects that price moves were less powerful even though they made lower lows on the main price chart—when price cannot pierce the bands as deeply with each subsequent low, and when price eventually cannot even tag the band with a new low in October 2022, this shows price may be ready to consolidate or mean revert. Supplementary Chart E: Bollinger Bands Signaling Exhaustion and Temporary Pause in Downtrend 9. For anyone trying to catch the bear rallies, watch out for false breakouts above resistance as discussed in the following linked post, showing a false breakout this month above a shorter-term trendline. When the primary trend is down, countertrend moves can be challenging and tricky, so tight stops make sense. Supplementary Chart F: False Breakout above Resistance—Example from October 6, 2022 ________________________________________ Author's Comment: Thank you for reviewing this post and considering its charts and analysis. The author welcomes comments, discussion and debate (respectfully presented) in the comment section. Shared charts are especially helpful to support any opposing or alternative view. This article is intended to present an unbiased, technical view of the security or tradable risk asset discussed. Please note further that this technical-analysis viewpoint is short-term in nature. This is not a trade recommendation but a technical-analysis overview and commentary with levels to watch for the near term. This technical-analysis viewpoint could change at a moment's notice should price move beyond a level of invalidation. Further, proper risk-management techniques are vital to trading success. And countertrend or mean-reversion trading, e.g., trading a rally in a bear market, is lower probability and is tricky and challenging even for the most experienced traders. DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
NASDAQ:AMD
by SquishTrade
23
When a divergence isn't a divergence and price winsA fellow trader here on Trading View needed some help with a trade he is taking. Commonly when an RSI makes a new LOW and price makes an opposing HIGH this is called a "Bearish Divergence" When this happens, its expected that price will follow and make new Lows or start moving down. But what happens when price continues to move up? Why would it go against the momentum of the all mighty RSI? How is it possible that price can reject what the RSI wants to do? Well the answer is VOLUME and who is in control of it. The Bulls or the Bears...and whomever is in control, will always win. In this video you'll see something else to look out for when trading divergences so you can predicts which way price will breakout.
Education
by CoffeeshopCrypto
5
DJI - testing near term resistence soonDJI is now above both it's 200day MA as well as an intermediate trendline resistence. However, we are seeing bearish divergence between price and RSI on DJI's daily chart and with near term horizontal resistence coming up @ 34100-34300, we could have some pullback when it reaches there. Fibonacci retracements of 23.6% to 50% of it's most recent swing up will still be "acceptable" for the bulls and does not mean the market has turned bearish (unless we have a deeper pullback). I suspect the low we saw in early Oct (28660) is "The" Low of this bear market as we saw a "tweezer bottom" / bullish engulfing candle on the monthly chart. Signals on the longer time frame (ie the "Bigger Picture") will be more powerful than on the shorter timeframe. However, there is always the fear that FED could step in to brake any further upside, hence expect market to still be volatile and could also trade in a wide sideway range for a while (weeks/months?) before we can see the 200day MA flatten out and then start can turn up. Meanwhile, DJI's further upside could slow down while Nasdaq begin to take leadership. As long as Nasdaq is taking the lead then the overall market will still be in a more bullish rather than bearish mood. Take one swing at a time. Have stops in place in case one is wrong. Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is important! Take care and Good Luck!
TVC:DJI
by Juliac
4