Wassup traders! It's been a while. Let's dive right into it!
The pair has been in a downtrend on a year-to-date basis, is currently relatively overbought and is trading around a 3-month+ old resistance level. While buyers still appear to be in control, all indicators hint at a move to the down side. A close below the labeled threshold will serve as a confirmation for the conservative trader. A close above the resistance level doesn't necessarily mean that our analysis has been invalidated. It'll mean that the pair is even more overbought than it currently is.
Interpretation;
Prices drop faster than they rise in a downtrend and rise faster than the drop in an uptrend (Yes, it's true. Go check it out!) . This is valuable info since trading against the prevailing trend can be thought of as "swimming against the tide". It's futile because a pull-back in the opposite direction of the prevailing trend is only a retracement of the previous swing (in most cases), meaning that it's short-lived. Now, more than ever, the stars are aligned in our favor. Not only is the pair overbought, it is so in a downtrend nonetheless!
The pair has been in a downtrend on a year-to-date basis, is currently relatively overbought and is trading around a 3-month+ old resistance level. While buyers still appear to be in control, all indicators hint at a move to the down side. A close below the labeled threshold will serve as a confirmation for the conservative trader. A close above the resistance level doesn't necessarily mean that our analysis has been invalidated. It'll mean that the pair is even more overbought than it currently is.
Interpretation;
Prices drop faster than they rise in a downtrend and rise faster than the drop in an uptrend (Yes, it's true. Go check it out!) . This is valuable info since trading against the prevailing trend can be thought of as "swimming against the tide". It's futile because a pull-back in the opposite direction of the prevailing trend is only a retracement of the previous swing (in most cases), meaning that it's short-lived. Now, more than ever, the stars are aligned in our favor. Not only is the pair overbought, it is so in a downtrend nonetheless!