Topdown Analysis Of SOLUSDT Using Support And Resistance Strategy And RSI Indicator As A Confluence
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Hello great minds,
It is a wonderful opportunity to come before you all today to discuss on an issue of great importance in the cryptospace.
I believe you are doing perfectly fine and are enjoying your activities in the community as you actively promote steemit across various social media platform.
Today, I will be sharing my analysis on solusdt, and Solana is a popular token in the cryptospace.
Solana is a very popular project in the cryptospace and has brilliant team who are diligent and have great fundamentals, and as such, I will be sharing my analysis.
Please stay tuned and check out my analysis on this great token.
ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY
My analysis of the cryptomarket often begins from the higher timeframe to the lower timeframe, but I prefer beginning mine from the monthly timeframe.
The monthly timeframe helps me a lot in filtering out noise from the market, and alongside that, it also plays a huge role in the identification of market trends.
Begining with the monthly timeframe of the pair solusdt, we can see that there are bullish and bearish candles present in the market.
And we can also see that there are lesser candles on this timeframe, and this is because each candle is formed within the space of 1month.
Also on this timeframe, it is easier for the overall market trend to be detected, and we can see that the market is being bullish on its most recent legs.
I then moved to the weekly timeframe for more market analysis, and on this timeframe, I could see more candles as each candle is being formed within the trading period of 7days.
And looking carefully, I was able to identify a key level and this level is functioning as a resistance level to the market price, and the market is expected to be rejected whenever it trades towards this level.
And from the above screenshot, we can see that the market has made several touches on this level and has been unable to break above it which shows the strength of this level in the market.
I then continued my analysis to the daily timeframe, and on this timeframe, I could see more activities on the price chart, I could see the formation of bearish and bullish candles in the market.
And looking carefully, I was able to identify another key level and this level is functioning as a support level to the price chart and the market is expected to be rejected whenever it trades towards this level.
And from the screenshot above, we can see that the market has respected this level severally and has failed to break below it.
And getting to the 4hr timeframe, I could see lots of noise in the market, I could feel the presence of the buyers and sellers as they struggle to drive the market to their preferred direction.
And from the above screenshot, I can see that the bulls are in control of the market, as it keeps forming higher highs and higher lows and trading towards its resistance level.
And when it approaches its resistance level, we can expect to see a bearish rejection of the price chart, and then we can join and enjoy the ride.
With my bearish bias of the market, I decided to move to the 2hr timeframe in search of entry into the market.
And from the above screenshot, I can see that the market is aggressively trading towards its resistance level and I can take a sell when it gets into this level, and before then, I decided to search for my entry using the relative strength index indicator.
CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR
The rsi indicator is a technical tool that is used to detect overbought and oversold market.
When the rsi oscillator crosses above the 80% line, the market is said to be overbought and this is known to be a bearish trend reversal signal.
And when the rsi oscilator crosses below the 20% level, the market is said to be oversold.
An oversold market signifies a bullish trend reversal signal, that is , the market is expected to move in the upside direction.
Applying the rsi to the monthly timeframe, I realised that the market is being overbought and an overbought market signals a bearish trend reversal of the market.
An overbought market can be detected when the rsi trades towards its 80% line, and this can be understood to show the strength of the bears over the bulls.
And moving to the daily timeframe, I could see that the market is also being overbought and an overbought market is understood to be a bearish trend reversal signal.
It shows the strength of the sellers as they are about to drive the market downwards and this is in alliance with my analysis using support and resistance strategy.
And then moving to the 2hr timeframe with my bearish bias toward the market, I decided to search for bearish entries.
Then I placed my entry on the closest resistance level to the market and my take profit was placed on a key level which the market is mostly likely to react on.
CONCLUSION
Solana is a very good project in the cryptospace but I encourage all to make their own research before investing in any token.
My post should not be taken as a financial advise rather as an educational content.
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