Felt compelled to write this because a lot of ideas are claiming we've bottomed out and the bulls are back. False... at least the part about bulls. The bears are still in control and have been setting bull traps for the last few weeks and today is no different. Take a close look at the RSI. Control changes hands when the RSI touches the 70 near ATHs or the 30 near ATLs. Since the bears took control, there have been dips below the 30 but no touches and now that it appears we're close to the bottom, the RSI needs to touch 30 before the bulls take back control. In short, I expect at least another retest of $7,200 or $6,000 with an RSI touching the 30 without crossing it before the bulls have control.
good read thank you! Where can I find information about RSI interpratation?
Regera
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@BatterT, there isn't much because it's considered one of the easier indicators to read. That said, reviewing it over the longer term is quite helpful when trying to identify changes in the trend. Whenever conditions cross outside the 70 or 30, it shows euphoria buying or panic selling... neither of which is an accurate representation of the bulls or bears exchanging control. When it nears the 70/30 then slowly and steadily breaks through (or reverses at) resistance levels (i.e. the 55 on my chart), it shows the bulls'/bears' control of the market. That's why I'm not sold on the bulls having control of this market YET. I believe it's likely we'll see a change in the coming weeks but for now I'm quite confident that there is going to be another retest before the bulls take over.