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Daily MACD is still looking beefy, but it is right at the zero line which historically has signaled a turning point.
The 4H is showing hidden divergence. This suggests that the bear wedge will fail despite the distribution that has been occurring.
1/16/19: This is for Wednesday. Price action is starting to get a little messy, but we are still getting price that mostly respects S&R areas. The patterns are still somewhat clean, but if you take a look at the MACD, you can start to see the choppy bullish price action (I boxed the areas). Compare that to the beautifully clean down cycle MACDs. Instead of a smooth trending cycles we are getting divots and bumps on the MACD. This tells me that despite the 4H divergence, we are still in a distribution mode as the bears are fiercely combating bulls. This could also very well be an accumulation just under the resistance line for a breakout seeing as the 4H is suggesting a weakness in distribution.
Since the sellers still mean business what I kind of expect to see is a breakdown from the 4H wedge that turns out to be a failure when the bulls catch the bears with their pants down. Of course it's just as possible that we get a surge of bullish momentum that breaks the bear wedge and then comes back down for a retest of resistance. Nonetheless at the moment I am bullish in the coming week/month.
Can you help answer these questions from other members on NexusFi?
Today was a big bear wedge that started from premarket and it seemed to be obeying previous days' support and resistance very well until it popped up into uncharted territory. It was the perfect time to break down too since we were near the top of the bear wedge and at resistance. This is what stops are for, eh? I have to wonder if the funnymental news about the US removing the tariffs to expedite the china deal caused the surge in upward momentum. Who knows the reason. Price quickly crashed back down and while it's above resistance, it is looking relatively weak and I have doubts whether we can hold this level short term.
I've been on a haitus; been preoccupied with life. As much as I love to theorycraft, it doesn't pay the bills. The way I see it is Kewltech TA is simply the application of classical technical analysis--levels and patterns-- to trade momentum and trends. It's nothing complicated, but it is fairly subjective. That is the crux and why I haven't been investing my limited time to make posts and have instead been studying methodology. Anyone can find patterns looking at historical data, but only a trader can trade the unknown (aka "hard right edge"). In the interest of solidarity I attached my Monthly Execution Review. This is a summary of whether or not I followed my entry and exit rules. Ironically.. my win rate is about 50%, which is almost equal to my good/bad execution rate... The BIG difference between my execution sheet and the TA i've been doing is the timeframe. I don't have hours (or the patience) to sit monitoring a trade so my entries have been on a much smaller timeframe and arguably less clean TA. I'll try to keep this thread regularly updated and I may need to adjust my reviews to the timeframe I'm trading. I'm also looking to make this a little more mechanical, but I don't want to stray too far from the tree. Have a good weekend!
Yea I agree with you that Kewltech is hard to understand, do you still use a market structure/price action method similar to this? Also, I agree, it's difficult to know which levels are going to be hit and which are not, that's why I've heard you have to scale into and out of positions. Very curious to hear how you've progressed since you started this!
Why is it called exaggerated Divergence? Also, I think I may've just gotten Hidden Divergence, it's the reverse order of regular right, so when price is trending down, the oscillator is trending up?