📉 BEARS vs BULLS, Market Psychology, Basics & How To Trade

11. Apr.

There are always two sides to every coin, heads or tails; and there are always two sides to every chart, bearish and bullish.

Here we are going to be looking at the signals for the NVDA stock on both sides.

Nvidia was already a massive company thanks to its chips and cards but with the advent of Cryptocurrency it become #1. Now we have this situation where the stock, Bitcoin and related markets became linked.

Since people use the chips produced by this company in relation to Bitcoin (mining), when Bitcoin drops, the stock tends to drop.

Nvidia has been on a very long growth trajectory and a correction can develop anytime.
Growth can also continue.

The chart here gives us signals... The chart is never right or wrong.
The signals can't be right or wrong.

It is data, information; a tool.
We can use it in whatever way we think is good.

While the chart can't be wrong, it is not the same for us, we can make mistakes.

How successful we are making predictions will depend on the interpretation we give to these signals, let me give you an example: We have three weeks red here...

(Keep reading the example after the signals below!)

👉 BEARS

➖ The highest volume happened in August 2023.
➖ The All-Time High session in March 2024 closed as an inverted Hammer; a strong bearish signal.
➖ There is a second Hammer candlestick pattern in March and both these hammers, inverted and standard, have less volume than the Aug. '23 session. This means that the bulls are losing strength (declining volume).
➖ Three consecutive weeks red. After seeing these initial bearish signals, going three weeks red support a bearish bias.

This is the bearish potential of the chart revealed.

👉 BULLS

➖ NVIDIA is an massive uptrend.
➖ The RSI is strong but has been declining for almost a month (since March).
➖ Trading above EMA10.
➖ Very strong Cryptocurrency market.

We have three weeks closing red but this does not mean that NVDA will necessarily continue lower but it is indeed a very bad signal when combined with those mentioned above. So even though we have this bearish signal, the truth is that Nvidia has been growing and it keeps on growing and it remains bullish with a strong RSI, high volume, etc.

So, what to do?
How to trade?

Very easy:
(1) If prices move below support, the bearish bias becomes stronger.
(2) If prices move above resistance, the bullish bias becomes stronger.
(3) When in between, the projection remains within the previous trend.
(4) When in between, we can look for signals to spot if the asset will move with the bears or the bulls. We use the signals to plan our decisions. The decisions we make define our trades. If market conditions change, we adapt and also change.

Namaste.

17. Apr.

Anmerkung

On the daily timeframe, we can see lower highs since 8-March:

➖ NVDA is now trading daily below EMA10 and EMA21.
➖ The RSI is weak.

Everything keeps pointing lower.

20. Apr.

Anmerkung

➖ Nvidia closed its fourth consecutive week red.
➖ Nvidia closed weekly below EMA10.
➖ Nvidia is now the most bearish its been since 2022.



Will Bitcoin drop or not?
You can find clues in this and the SPX chart.

It is all going down as they've been moving together.
So, do the best you can to protect yourself, your assets, your profits, your portfolio, your family, your woman/man, your dog, your cat and your trades.

Namaste.

1. Mai

Anmerkung

The short bounce is now over, we can see a lower high being confirmed.


A lower high will lead to a lower low.
This is easy to see now.

Thank you for reading.

1. Mai

Anmerkung

This one looks better:

9. Mai

Anmerkung

A classic lower high is being established:

The daily trading volume shows a tendency for prices to move lower.

NVDA bearish potential remains active/valid.