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92 lines
4.8 KiB
Markdown
92 lines
4.8 KiB
Markdown
GME: The Powder Keg Ready to Explode
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| Author | Source |
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| :-------------: |:-------------:|
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| [u/RocketTraveler](https://www.reddit.com/user/RocketTraveler/) | [Reddit](https://www.reddit.com/r/Superstonk/comments/obteg7/gme_the_powder_keg_ready_to_explode/) |
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---
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[Education 👨🏫 | Data 🔢](https://www.reddit.com/r/Superstonk/search?q=flair_name%3A%22Education%20%F0%9F%91%A8%E2%80%8D%F0%9F%8F%AB%20%7C%20Data%20%F0%9F%94%A2%22&restrict_sr=1)
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Hey all,
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GME is a massive powder keg about to explode. Curious? Read on to find out more...
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A very reliable technical indicator created by Rocky Outcrop is flashing a rare signal that cannot be ignored.
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Full credit goes to Rocky Outcrop and Trade Spotting for creating this custom DMI indicator and sharing it with the masses.
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TLDR
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- The Directional Movement Index (DMI) started flashing a powder keg signal on June 29th. This signal has only flashed three other times in all of 2021
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- The ignition source of the signal (the ADX line) is at it's fourth lowest point since 2018. The lower the ADX goes, the more certain we can be of a near-future run-up
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- When the powder keg explodes, expect volatility and momentum to skyrocket
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DMI
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The Directional Movement Index (or DMI for short) is a technical indicator made up of three components:
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- DI+: This shows the current momentum of positive price movement. This is shown in YELLOW on my charts below
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- DI-: This shows the current momentum of negative price movement. This is shown in PINK on my charts below
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- ADX (Average Directional Index): This shows the *strength* of the current price movement. This is shown in BLUE on my charts below (crossover points denoted in orange)
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The powder keg signal: When the DI+ and DI- lines converge (come together) AND the ADX line is simultaneously at a low point, the powder keg is lit. This is denoted by a gray background highlight on the charts below
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Without further ado, here are the charts:
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Current Price Action
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[](https://preview.redd.it/lklugrdlhn871.png?width=1032&format=png&auto=webp&s=4678d387e3ac1f692432e9117266407ce291cd1c)
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Current Price Action. DMI Power Keg lit as of June 29th
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Above shows our current price action over the last 6 weeks. As we have been consolidating from June 9th, the DI+ and DI- lines have converged and the ADX is at an extreme low. Notice the powder keg signal flashing (light grey box) as of June 29th.
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Historical Price Action
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[](https://preview.redd.it/tsvvhn7mln871.png?width=1098&format=png&auto=webp&s=c88a922bbf50331713f897de4995ba44ac13a078)
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Historical Price Action. Multiple Signals Flashing over 2021
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This is only the 4th time this entire year the DMI powder keg has been lit
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- The first signal was flashed at the end of February roughly 1 week before our huge run-up from $40 to $350
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- The second and third signals were flashed together roughly 2 weeks before our May run-up from $140 to $350
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- The fourth signal just started flashing on June 29th. This would indicate a huge move up in the next 1-2 weeks. Run-up to commence from $200 to ???
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Bonus Chart
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[](https://preview.redd.it/m19pl7zxjn871.png?width=1538&format=png&auto=webp&s=56a9d0a9096ea3b1dd860b035d812d0c5455a879)
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Historical ADX Data
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Bonus chart!
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The ADX is the fuse that ultimately ignites everything as it shows the current momentum has stalled and volatility is ready to pick back up again.
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Since 2018 the ADX has only ever been this low THREE OTHER TIMES. The most recent low point is happening right now! Historically speaking, GME is in a situation where it is ready to explode any day.
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Footnote
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For those who believe TA is invalid on GME and other SHF-manipulated stocks, I respect your opinion.
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My opinion? TA is not the holy grail by any means, but it is still valid on GME.
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Why? Because TA relies heavily on human patterns and emotions as they relate to stock prices. GME is no exception. There are still support and resistance levels like everything else.
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Yes there is no denying GME is heavily manipulated, but that doesn't change the larger philosophy TA is based on.
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Remember, TA is not a crystal ball but it does offer a glimpse into the most likely outcome.
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To each his/her own.
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*I am not a financial advisor and this is not financial advice*
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