Analysis provided by Ashton Fraser, learn more about his Forex Reversals trading strategies.
After a rise to 3.35 this morning, Peercoin has now made a significant retrace, with some resistance coming into play as well.
Let’s take a closer look at PPC/USD on the H1 chart below (click to expand):
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I’ve performed the Fibonacci study from the current swing low at 3.1, until today’s high at 3.35.
The first pattern to notice is the candlestick marked in red. We can see how long it’s upper wick is, extending way beyond the upper Bollinger band, and with barely a body to speak of. Immediately after this, the Accelerator Oscillator turned red on the very next candle.
By 10am GMT, the Awesome Oscillator had also turned red, and with the Stochastics having crossed over, heading down and being undersold, price ultimately fell for the next few hours. If you look at each of the four consecutive bear candles, (marked with an orange arrow), it’s clear how they were all very strong bear candles, possessing firm bodies, with barely any lower wicks.
However, as so often happens, the momentum was put to an abrupt halt upon a significant Fibonacci retracement level, in this case the 61.8% level at 3.2.
Yet, I still expect price to break this minor support at 3.2, given the bearish strength of the rest of the technicals I’m observing, possibly reaching 78.6% later this evening, although there will probably be some ranging before that.