KASPA TECHNICAL ANALYSIS + TRADE PLAN 2024 BY BLAŽ FABJAN
2024-10-07

TA+TRADE plan by Blaž Fabjan

Descending Triangle Formation:
A clear descending triangle pattern is observed with lower highs (resistance) and a horizontal support around the $0.14 level. This is typically a bearish pattern, but in some cases, it can lead to a breakout to the upside.
The current price is close to the triangle’s apex, indicating a potential breakout soon.

Support and Resistance Levels:

Resistance: The downtrend resistance line is around $0.145 to $0.15. A break above this level would indicate a bullish reversal.

Support: The horizontal support around $0.14 has been tested multiple times. If the price breaks below this, it could trigger a further decline toward the next major support at around $0.13.

Indicators:
Volume Moving Average Convergence Divergence (VMAC): There are visible divergences, suggesting that momentum might be building. The overall indicator seems to support a bullish divergence.

Relative Strength Index (RSI): The RSI is near the oversold region (~35.49). This suggests that selling pressure might be easing, and a reversal could be imminent.

Stochastic Oscillator: The stochastic is near oversold levels, which often precedes a bullish move if it crosses upward.

Hull Moving Average (HMA): The histogram is showing signs of reduced bearish momentum, with green candles suggesting a possible bullish shift.

Trading Strategy

 Bullish Scenario (Breakout to the upside): 

Entry: Consider entering a long position on a confirmed breakout above $0.145-$0.15 (the resistance line). This would signal the end of the descending triangle and likely lead to upward momentum.
Target 1: $0.17, which would align with the projected move from the triangle breakout.
Target 2: $0.19, a previous high and psychological resistance level.
Stop Loss: Place a stop loss below $0.138 to minimize risk in case of a false breakout or bearish continuation.

 Bearish Scenario (Breakout to the downside): 

Entry: If price breaks below the $0.14 support level with volume, it could signal a bearish continuation. Short positions could be considered in this case.
Target 1: $0.13, the next major support.
Target 2: $0.12, the next significant psychological support level.
Stop Loss: A stop loss above $0.145 (above the resistance) would minimize risk if the trade reverses.

To sum up:
The current technical picture is at a critical point with a descending triangle suggesting a potential breakout in either direction. The oversold conditions in the RSI and stochastic, along with possible bullish divergence, lean towards a bullish breakout. However, be prepared for a downside if the $0.14 support fails.

Monitoring the volume during the breakout is crucial to confirm the direction and strength of the move.