Topdown Analysis Of AVAXUSDT Using Support And Resistance Strategy And RSI Indicator As Confluence

jueco (77)modquality controllerin Steem Alliance • last year

Hello great minds,

I feel honored to approach you all today to discuss on a very important issue in the cryptospace.

I believe you are all 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 the token of avalanche network which is avax, and I will be sharing my analysis on avax against usdt.

Please stay tuned as I share my analysis

ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

Technical analysis are best started from the higher timeframe and then to the lower timeframe.

Some analyst prefer starting their analysis from the daily timeframe, down to the fewer minutes, but I begin mine from the monthly timeframe.

The monthly timeframe helps me to compress market activities and display them on a screen.

And the monthly timeframe also helps in eliminating unnecessary noise from the market.

Shown above is a screenshot of the pair AVAXUSDT on the monthly timeframe, and as seen above, there are few candles on the monthly timeframe.

Also, there are lesser market noise on the monthly timeframe, as each candle formed took a period of 1month to be formed

Also we can identify the market trend to be bearish overall but it's latest leg is being bullish, forming higher highs and higher lows consecutively.

Moving to the weekly timeframe, I could see more market activities, as there are more candles on this timeframe than on the weekly timeframe.

Also, I was able to spot a key level on this timeframe, and this level is functioning as a resistance level to price chart.

It is expected that when price gets to this level, it is rejected to the bearish side, depending on the strength of the sellers in the market.

Moving to the daily timeframe, I saw more market candles, more noise in the market which can easily deceive traders into making a wrong trading decision.

On this timeframe, I looked carefully and was able to spot another key level on the market, and this level is currently functioning as a resistance level.

And it has previously been respected by market price as a support level, and now it is functioning as a resistance level.

On the 4hr timeframe, I can see more noise in the market than on the daily timeframe.

I can see the struggle between buyers and sellers to drive price to their preferred direction.

And also, I was able to spot a key level in the market which is functioning as a support level, and as seen, the market has approached this level, and we expect to see a bullish rejection candle.

Moving to the 2hr timeframe, I looked carefully and saw a bullish rejection candle on the price chart, and this is a confirmation to enter a buy on the market.

And before entering, I decided to search for confluence using my rsi indicator.

CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

The rsi Indicator is a very important trading tool in the cryptomarket.

The rsi indicator is used to spot oversold and overbought market regions.

And when a market is spotted to be oversold, it is a signal that the market is about to experience a bullish move.

And when a market is spotted to be overbought, it is a signal that the market is about to experience a bearish move.

Today, I decided to add the rsi Indicator from the daily timeframe.

And as seen above, the rsi indicator has crossed below it's 20% line and this is an indication that the market is being oversold.

An oversold market is usually a bullish trend reversal signal, and this is in alliance with our analysis using support and resistance strategy.

Moving to the 4hr timeframe, I noticed that the rsi indicator has also crossed below it's 20% line, and this is an indication that the market is being oversold.

An oversold market signals a bullish trend reversal signal, and this is in alliance with our analysis using support and resistance strategy.

Then I decided to move to the 2hr timeframe for more analysis before searching for my entry.

I also noticed that the pair AVAXUSDT on the 2hr timeframe is being oversold, and this is a bullish trend reversal signal.

I then decided to place my entry on the closest support level on the price chart, and my take profit was placed on the closest resistance level, just as seen above.