Technical Analysis - DeFi Money Market
DMG/USD - Week 38
As shown in the chart above, we will be analyzing the technical status of DMG/USD.
DMG is currently very clearly in a downtrend after its strong and impulsive breakdown from the previous key area of support.
After the breakdown and break of support, DMG went into a price discovery in the negatives. Support and key-levels have to be established and made sure that investors know about it and value it there.
Looking at the current market structure, one can see a strongly divergent yet still downtrending structure. This structure is a descending channel that usually is known as a bull-flag. Yet, as experienced analysts, these structures can become “over-extended,” which is precisely what we see here.
Such over-extended structures are always wildly divergent and cause many times a very strong breakout after stopping out many early-longers.
Looking at technical indicators, the MKAST Algorithm is showing a sell-condition since the beginning of the breakdown, which is understandable, and it would most likely change after a strong breakout or impulsive move.
The MKAST Index shows 4/15 points, which is quite low and considering hitting 0 a few times before. Moreover, the Index compared to the chart shows many bullish divergences and a massive one since the beginning of the structure.
An experienced trader would be looking for entries after a strong impulsive candle breaking the descending structure.
This Technical Analysis is made by Kong Trading. The provided Analysis reflects only his idea and should not be considered as financial advice!
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