diff --git a/Beginner-Information/Technical-Analysis/GME-Technical-Analysis-Reading-Price-Action.md b/Beginner-Information/Technical-Analysis/GME-Technical-Analysis-Reading-Price-Action.md new file mode 100644 index 0000000..5ab0a62 --- /dev/null +++ b/Beginner-Information/Technical-Analysis/GME-Technical-Analysis-Reading-Price-Action.md @@ -0,0 +1,98 @@ +GME Technical Analysis - Reading the Price Action +================================================= + +| Author | Source | +| :----: | :----: | +| [u/squidja](https://www.reddit.com/user/squidja/) | [Reddit](https://www.reddit.com/r/Superstonk/comments/mvvk47/gme_technical_analysis_reading_the_price_action/) | + +--- + +[DD 👨‍🔬](https://www.reddit.com/r/Superstonk/search?q=flair_name%3A%22DD%20%F0%9F%91%A8%E2%80%8D%F0%9F%94%AC%22&restrict_sr=1) + +I am new to trading, just getting started on January 27th during the first event, so definitely don't take any of this as financial advice. + +Although I love watching/reading GME news it's mostly for entertainment purposes and isn't a factor in why I HODL. I HODL because I agree with the DD. + +In swing trading I look for reversal patterns and trend lines using technical indicators to give me a complete picture of the price movement. + +GME is a heavily manipulated stock but I believe there are still insights we can gather from analyzing the chart. + +There are essentially three types of trading: + +Day Trading / Intraday Scalping - Short term trading where trades are placed during the same day often times buying and selling within minutes or seconds. + +Swing Trading - Medium term trading where trades take place over several days or weeks. (This is the system I use) + +Investing - Long term that spans years. + +I look at 1 Year, 1 Day charts every day and use technical indicators to *attempt* to predict the price. No system is 100% perfect because no one can predict the future. (btw, by this point you're probably thinking, "Is this guy day trading GME?" Absolutely not, that would create more liquidity.) + +The first indicator I use are Candle Sticks. They basically give me a quick summary of the days price action. + +Candle Sticks take the day's price action, + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/gmn0e5kjsmu61.png?width=2256&format=png&auto=webp&s=c31341bf0e7e236250b644887903b69fb1f918ea)](https://preview.redd.it/gmn0e5kjsmu61.png?width=2256&format=png&auto=webp&s=c31341bf0e7e236250b644887903b69fb1f918ea) + +GME Wednesday, April 21st. + +and condense it down to this to summarize the days movement (I'm a Creative Director so I have really good crayons.) + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/xcv9epmy1nu61.jpg?width=8001&format=pjpg&auto=webp&s=f9e239984e2d4aed51a1ca9c70622669aaf59fe4)](https://preview.redd.it/xcv9epmy1nu61.jpg?width=8001&format=pjpg&auto=webp&s=f9e239984e2d4aed51a1ca9c70622669aaf59fe4) + +If the price went down for the day it's a red candle stick, if it went up it's a green candle. + +When I zoom out and add my indicators (I'll cover those shortly) I can see the trend line over the last few months. + +Moving Averages I use: + +18-Day: Exponential Moving Average (more weight towards most recent candles) + +40-Day: Exponential Moving Average + +50-Day: Simple Moving Average + +100-Day: Simple Moving Average + +150-Day: Simple Moving Average + +200-Day: Simple Moving Average + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/2s6vhg50tmu61.jpg?width=8001&format=pjpg&auto=webp&s=0604e9838561e30891b13bb8e0f39c9d9d500b25)](https://preview.redd.it/2s6vhg50tmu61.jpg?width=8001&format=pjpg&auto=webp&s=0604e9838561e30891b13bb8e0f39c9d9d500b25) + +GME has been on a clear uptrend with strong support levels that have recently been tested and proven strong. + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/ufta29u06nu61.jpg?width=8000&format=pjpg&auto=webp&s=68022a3ae76c970624a983f182fd707f1149d15b)](https://preview.redd.it/ufta29u06nu61.jpg?width=8000&format=pjpg&auto=webp&s=68022a3ae76c970624a983f182fd707f1149d15b) + +So we know GME is on a clear uptrend and has strong support levels. This should continue as long as ape hold banana. + +GME is currently low volume, sideways trading: + +We're currently stuck in low volume low price movement, boring days. But look what happens at the end of those boring periods. The price goes *BRRRRRRRRRRRRRRR!* + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/z6ubg4viumu61.jpg?width=8000&format=pjpg&auto=webp&s=a6a3300503665b97494ef2d7a1e374f3c1522104)](https://preview.redd.it/z6ubg4viumu61.jpg?width=8000&format=pjpg&auto=webp&s=a6a3300503665b97494ef2d7a1e374f3c1522104) + +Each time it looks like there's more force behind it. + +Moving Average Convergence Divergence (MACD) + +This is an indicator I use to show me when a price trend *should* reverse. The bullish or bearish trend will reverse and the price will move in a new direction. + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/schhxzk0xmu61.jpg?width=8000&format=pjpg&auto=webp&s=ab3ec05fc9a90592680b776e2ba38ef17c0c8588)](https://preview.redd.it/schhxzk0xmu61.jpg?width=8000&format=pjpg&auto=webp&s=ab3ec05fc9a90592680b776e2ba38ef17c0c8588) + +Here's a closer look at the MACD Line (Black) converging the Signal line (Red) + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/fzbkwzqzxmu61.jpg?width=8001&format=pjpg&auto=webp&s=5d7d4c3f5b7f7c7a5c205421703ae75356dfa87f)](https://preview.redd.it/fzbkwzqzxmu61.jpg?width=8001&format=pjpg&auto=webp&s=5d7d4c3f5b7f7c7a5c205421703ae75356dfa87f) + +GME appears to be approaching a divergence point! + +Parabolic Stop and Reverse (ParabolicSAR) + +This indicator puts a dot above or below the candles and will flip to a new side in a reversal. We just flipped to bullish 3 days ago! + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/y92eymdhymu61.jpg?width=8001&format=pjpg&auto=webp&s=5dcca3129632f68cde44f41e0140bae8c1de8cc0)](https://preview.redd.it/y92eymdhymu61.jpg?width=8001&format=pjpg&auto=webp&s=5dcca3129632f68cde44f41e0140bae8c1de8cc0) + +All of my indicators are telling me it's time for the price to reverse and go up. Here's the coolest part in my opinion, when I actually zoom all the way out to a year the force behind the price movement appears to be incredibly strong. + +[![r/Superstonk - GME Technical Analysis - Reading the Price Action](https://preview.redd.it/pkjunk790nu61.png?width=3104&format=png&auto=webp&s=c22b7eed87f1bed3c234134a6a3ed50924261c51)](https://preview.redd.it/pkjunk790nu61.png?width=3104&format=png&auto=webp&s=c22b7eed87f1bed3c234134a6a3ed50924261c51) + +I actually believe the price can go to $10,000,000 as long as enough retail HODL!