Analysis provided by Ashton Fraser, learn more about his trading strategies with the forex reversal indicator.
Namecoin almost touched 3.000 which I expected, as mentioned in yesterday's analysis, however we're now seeing some ranging take place.
Let's take a closer look at the NMC/USD four hour chart below (click to expand):
I've performed the Fibonacci study from the high on the 9th of March at 3.5, until the month's low at 3.015 from yesterday.
Now, check out that bull candle marked in a blue ellipse. We can see how its lower wick is very long, comprising around half of the entire candlestick. Then, the remaining part of the candlestick is taken up by the body, meaning, there's barely an upper wick. In addition, it's body is longer amongst the longest from the past fifty or so candles, with price closing above the 23.6% Fib retracement level. These facts alone tell us this is a powerful bull candlestick.
However, if we examine closely, there were signs of a retrace before it actually occurred. Take a look at the two candles prior to the one marked in blue. Both of them closed below the lower Bollinger band, and both of them were bull candles. At the same time, The Stochastics were oversold and had crossed up, heading north, whilst the Accelerator Oscillator was green.
The result? A surge up to the 38.2% Fib level at exactly 3.200, which explains why price stalled at that point.
Right now, even though the Stochastics are still heading north, the Accelerator Oscillator has just turned red. I expect price to remain between the confines of the middle and lower Bollinger bands for the rest of the day.
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