Disclaimer: This is not financial advice. Please conduct your own research before making any trading decisions.
This analysis explores a potential scalping strategy for Fantom (FTM) that combines technical analysis with current market conditions to identify a potential entry point against a recent bearish swing.
Market Context:
FTM is currently trading at $0.81 with a 24-hour trading volume of $245.2 million, experiencing a significant increase of 130% compared to the previous day.
Despite the volume surge, the recent price chart suggests a bearish swing filler pattern, indicating a potential continuation of the downtrend.
Scalping Strategy with Fibonacci Retracement:
This strategy utilizes Fibonacci retracement levels within the daily timeframe to identify a potential entry zone for a short-term reversal against the downtrend.
Entry Zone and Confirmation:
An alert has been placed at $0.68, corresponding to a key Fibonacci retracement level.
The ideal entry zone would be within a discount range between $0.64 and $0.68.
Triggering the entry will depend on observing signs of a trend reversal within this zone, such as reversal candlesticks, bullish divergence on technical indicators, or a decrease in selling pressure.
Target Profit and Stop-Loss:
Two potential profit targets are suggested, reflecting the scalping nature of the strategy:
- 20%: This represents a conservative target profit for a quick scalp.
- 35%: This is a more aggressive target profit aiming for a larger gain if the reversal strengthens.
- A stop-loss order placed below $0.56 is crucial to manage potential losses if the bearish trend continues.
Market Considerations:
- This strategy is a counter-trend approach and requires careful monitoring for confirmation of a reversal.
- The recent volume increase might indicate heightened volatility, so be cautious.
- Always prioritize risk management and never invest more than you can afford to lose.