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RE: Reddcoin (RDD) Imminent Breakout On 1D Chart

in #trading7 years ago (edited)

Hi @astronautjon, thanks for following me.

Those are trend lines that I use to establish what I believe is the resistance (price ceiling) and support (price bottom) levels.

On the 1H chart, the purple and yellow trend lines are the resistance levels, above which the prices don't seem to go (buyers meet resistance from sellers). However, when there is a "breakout," the buyers are much stronger than the sellers, so they break through the resistance lines. That signifies that the (downwards in this case) trend no longer applies and the price should move upwards now.

The red trend line represents the support level for those last several price movements, under which the price doesn't seem to go. That's a good thing in this case, because it shows that the price will continue to go up (above the red trend line).

The blue horizontal line, which the sellers merely touched in the last month or so, is the 61.8% Fibonacci level, to which price levels tend to retrace after a significant rise in price (all of those big green candles to the right). You can use the Fibonacci tool at pretty much all exchanges, including Bittrex. If not, try TradingView.com, but I don't believe it supports Reddcoin right now.

In this case, the Fibonacci line simply shows that it's very unlikely for Reddcoin to move below it, even if the sellers break downwards through that bottom white trend line (basically from above 68 sat to 57). But I speculate that because the bulls are so strong the 1H chart, the bears won't be able to break through it, so the price will continue to move along the white trend line upwards, until it breaks through the white trend line above (the resistance line). Once that happens, prices tend to spike-up, and it's very likely they'll rise as the previous big green candle sticks did, in a relatively parallel line (the dotted green line).

Trend lines article

Trend lines video