RETEST OF THE RECTANGULAR FLAG
Recap of ETHUSD previous chart.
In the previous chart ( https://ci.covesting.io/tradeidea/ethusd-9 ) , two charts were used to identify the possible move of price, which will likely be a pull back(throwback) or price might continue its up trend steadily. The pictures below are the pictures used in the previous chart, where a descending channel was spotted ( daily time frame) with a possible retest of the rectangular flag, making it to be a support level at $524. Same goes to the second chart, in which the FIBONACCI SPEED RESISTANCE/SUPPORT is used to determine the pull backs and push ups of price movement.
AS SHOWN BELOW:
BULLISH FLAG PATTERN (RETEST)
THE FIBONACCI SPEED RESISTANCE/SUPPORT FAN:
However, moving down to a lower time frame the one hour time frame a BEARISH PENNANT FLAG PATTERN has been spotted.
This makes the buy targets on the previous chart more valid.
Bearish Pennant is a short term bearish continuation pattern that occurs during a downtrend,
indicating a pause / small consolidation before continuing its downward moves.
Bearish Pennant pattern is usually preceded by a very steep (almost vertical) decrease in price on heavy volume.
This steep price decrease makes the “Flagpole” of the pattern.After the sharp decrease, the price movement is then contained within two converging lines (wide in the beginning and narrowing as the pattern develops), forming a small symmetric triangle / “Pennant” shape, on decreasing volume. The slope of the Pennant is usually neutral. This pennant represents a brief pause / consolidation in the midst of a downtrend before resuming its downward movement.The completion of the pattern occurs when prices break to the downside through the support level (i.e. lower ascending line) of the Pennant with a spike in volume. This would mark the resumption of the original downtrend.
TECHNICALS suggests that the buy targets on the previous chart is still valid pending when this bearish pattern will breakout and close below the flag.
Disclaimer: This is for educational purposes,it is not intended as a financial advice.
The analyst won't be responsible for a loss of fund. Trader should be able to manage risk.