Technical Analysis - Quant
QNT/BTC - 11/21/2019
As shown in the chart above, we will be analyzing the technical status of Quant against Bitcoin.
We will be asking a series of questions to come to a reasonable conclusion:
What is the current market structure?
Currently, on the 3Daily timeframe, we can see an uptrend and increasing market structure. Quant is approaching a previous key-level of resistance, where it got rejected previously and most recently. Nevertheless, this is not always a bearish sign. In this case, some traders would call this a “consolidation below resistance,” creating a scenario where the price fails to break the uptrend support and gets squeezed into the resistance, resulting in an impulse move upwards.
What is supporting the idea of a breakout?
To determine an answer to this question, we are taking a look at indicators and the strength of this trend. First, the volume is showing an overall decrease since the very first touch of the uptrend support. That is usually a sign of weakness and would be speaking against the anticipated breakout. Yet, this is the overall volume of the last 5-6 months, decreasing the significance over time. In this case, we continue with a break down of the volume of each move, showing us clearly, the volume is way more dominant in the upwards movements, increasing the likelihood of a breakout. Finally, the most recent volume (if looked at standard candles) is locally not significant (over the 20MA), yet still dominating on the positive candles. That shows a dominating interest of the market locally to buy Quant at these levels.
Are indicators supporting the idea of a breakout?
The TJ-Index is showing 10 out of 15 points, while up-trending since the beginning of this month. That is a reasonably bullish sign, indicating that selected conditions and indicators are slowly but surely turning bullish. Please remember, that impulse moves are most likely in oversold or overbought conditions.
Overall, QNT/BTC is one of the more bullish pairs in the most recent market. As elaborated above, quite a few signs are suggesting a possible breakout/impulse move occurring soon. Nevertheless, the near future does not mean immediately. It is essential to mention that the spread is quite big. That increases the importance of proper risk-management for this trade. It is suggested to plan to Take Profit Orders at previous key levels.
This Technical Analysis is made by Kong Trading. The provided Analysis should not be considered financial advice!