Navigating GALA’s Correction: Key Levels to Watch For
2024-12-10
Category: gaming

Current Situation 
Yesterday, I exited my GALA position based on confirmation from the 4-hour timeframe. Although I considered waiting for a daily close to validate the bearish trend, the strong downward signals on the smaller timeframe prompted me to act earlier. This decision proved advantageous, as we experienced a significant price drop.

 Broad Market Outlook: 

 Weekly Timeframe: 
The Stochastic RSI has crossed bearish (K below D), indicating that momentum is firmly downward on the larger time horizon. This suggests a sustained correction phase.

 Daily Timeframe: 
The Stochastic RSI remains in bearish territory, confirming that the broader trend is aligned with the weekly bearish momentum.

 4-Hour Timeframe: 
The momentum indicators are at levels that suggest oversold conditions, indicating a potential for short-term support and a bounce.

 Interpretation: 
We are currently in a correction phase, and support levels are crucial to watch. Based on the broader timeframes, this correction may last a while as the weekly and daily momentum indicators cool off.

In the shorter term, the 4-hour chart suggests the potential for a bounce, but this will likely develop into a consolidation pattern, such as a channel or triangle, as the market stabilizes.

 Key Levels to Watch: 

 Support:  $0.04358: This aligns with strong monthly support and the golden pocket (0.618 Fibonacci retracement). If this level fails, the next likely target is the 0.786 Fibonacci level at $0.03980.

 Resistance:  $0.04882: A short-term ceiling where price may struggle to break out until momentum shifts on higher timeframes.

 What to Look For Next: 
4-Hour Momentum Indicators: Await signs of positive momentum (e.g., RSI crossing upwards or bullish Stochastic RSI) to confirm potential support.

Consolidation Pattern Formation: After finding support, expect price action to form a sideways channel or triangle pattern, likely bouncing between the identified support and resistance levels.

Longer-Term Cooling: The correction may persist until the daily and weekly momentum indicators reset, preparing for a stronger recovery phase.

 Summary: 
Immediate support is anticipated around $0.04358, with potential range-bound movement between $0.04358 and $0.04882 in the short term.

A deeper correction to $0.03980 remains possible if bearish momentum continues.
Patience is key—wait for confirmation of support and momentum shifts before re-entering or trading.