What does this mean?


#1

I watched a youtube video today and the chap (The Moon) pointed this out. The upper part on the day chart shows a downtrend but the rsi is now showing an uptrend. Is this a good thing? Im still learning :slight_smile:


#2

RSI or, relative strength index gives us an indication of price momentum, so in this case, are oversold. So when looking at the RSI, and candle trends, we need to correlate with other indicators such as the moving average to see if a potential shift is occuring.

We can use the exponential moving average on smaller time frames to break down such movement


#3

so what does this mean? :wink: ah so price is slowing down :frowning:


#4

i see, so with the ema that will also tell us what is about to happen, and adding all theses indicators together makes for a bigger picture?


#5

That red line is trend resistance; which is what the MACD, or moving average convergence divergence, looks to inform the visual. So what we want to see happen, is a narrowing of a bearish trend, witht he candles starting to hug, and beak, that upper red line; which is fibonacci level 1.618. A key level of resistance when bearish. Usually, i tend to use td sequential, which is another indicator that looks for buy set ups, or continued sells.

I personally see another down trend of two days, as a td bearish count of 4, is common in this current trending. We have tested support too much, so i really expect more bearish momentum, but not too worry


#6

ok thanks for that, and glad to see youโ€™re back :slight_smile:


#7

You are most welcome, and thank you for the kind words! Good to be back :slight_smile: