Breakout and Breakdown Strategy in 3D Time Frame

Trend-Based Fibonacci Extension Levels (3-Day):
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1. Breakout Strategy
This strategy is for when the price breaks out above the 400% level or breaks down below the 361.80% level.

Bullish Breakout (Above 400%):
Trigger: A strong close above the 400% level, ideally with increased volume. Look for confirmation from indicators like the MACD (crossing bullish) or the Daily CMO moving higher from its low value.
Entry: Enter a long position just above the breakout candle high to avoid false breakouts.
Stop-Loss: Below the 400% level or the nearest support level, such as the 391% region.
Targets:
First Target (T1): 423.60% (next major resistance).
Second Target (T2): 450% if bullish momentum strengthens.
Bearish Breakdown (Below 361.80%):
Trigger: A strong close below the 361.80% level with confirmation (e.g., bearish MACD continuation or CMO dipping further negative on both Daily and 3-Day).
Entry: Enter a short position just below the breakdown candle low.
Stop-Loss: Above the 361.80% level or the last significant swing high.
Targets:
First Target (T1): 330% (midway support).
Second Target (T2): 261.80% (strong pullback level).
2. Range Trading Strategy
If the price continues to trade between the 361.80% and 400% levels, this strategy involves buying at support and selling at resistance.

Key Steps:
Entry:

Long near the 361.80% level if price shows signs of reversal (e.g., bullish candlestick patterns like hammers or engulfing candles).
Short near the 400% level if price shows rejection or reversal (e.g., shooting stars or bearish engulfing candles).
Stop-Loss:

For longs: Just below the 361.80% support level.
For shorts: Just above the 400% resistance level.
Targets:

For longs: Exit at 400%.
For shorts: Exit at 361.80%.
Indicators to Monitor in the Range:
Look for divergence between the CMO (Daily) and price at the support/resistance zones.
Use RSI: Enter positions when RSI approaches oversold (near 40) at support or overbought (near 70) at resistance.
3. Pullback Strategy
This strategy works if the price breaks a key level (either 400% or 361.80%) but pulls back to retest the level before continuing in the breakout direction.

Entry:
Bullish Pullback:
Wait for a breakout above 400%, then enter long when the price retests 400% and holds as support.
Bearish Pullback:
Wait for a breakdown below 361.80%, then enter short when the price retests 361.80% and confirms as resistance.
Stop-Loss:
Place the stop just below (bullish) or above (bearish) the retest level to manage risk.
Targets:
Bullish Target: First 423.60%, then higher extensions if momentum aligns.
Bearish Target: First 330%, then 261.80%.
Risk Management Tips
Position Sizing: Risk no more than 1-2% of your capital per trade to protect against unexpected moves.
False Breakouts: Be cautious of false breakouts—wait for confirmation (e.g., a retest or increased volume) before entering.
Multi-Time Frame Confirmation: Always confirm setups on both the Daily and 3-Day time frames, especially for breakout trades.
Final Thoughts
If you’re unsure about the direction, focus on range trading until a breakout occurs.
Watch for divergence between the Daily CMO (short-term momentum) and price. For example:
If CMO rises while price struggles at 400%, it could signal a breakout.

If CMO drops sharply as the price approaches 361.80%, a breakdown becomes likely.





Scenario Breakdown:

The price is consolidating between 361.80% (support) and 400% (resistance).
The pullback to 261.80% reflects a prior correction, indicating that this level might act as a significant support zone in the event of further downside.
The repeated rejection at the 400% level, coupled with resistance at 423.60%, confirms strong selling pressure in the current zone, preventing a bullish breakout.
MACD (3-Day):

The MACD line below the trend line with a previous bearish crossover suggests that bearish momentum dominates the 3-Day time frame. This adds to the challenges for a sustained breakout above 400%.
RSI (3-Day):

The RSI at 61 indicates moderate bullish strength but not strong enough to push the price past key resistance levels yet. The current level hints at consolidation or fading bullish momentum, depending on further price action.
CMO (Chande Momentum Oscillator):

3-Day time frame (CMO at 33): The asset still holds moderate bullish momentum on the higher time frame, although it isn’t in an overbought zone.
Daily time frame (CMO at 4.71): This much lower value indicates almost no momentum or very weak bullish sentiment in the shorter term. This divergence between time frames highlights a lack of alignment between the shorter and longer-term trends.
Interpretation of Multi-Time Frame Analysis:
3-Day Time Frame:
The asset is struggling to build momentum, as indicated by the bearish MACD crossover, rejection at 400%, and moderate CMO levels. The RSI suggests that the price is not completely bearish, but the indecision between 361.80% and 400% signals potential consolidation unless a breakout occurs.

Daily Time Frame:
The CMO at 4.71 in the Daily time frame shows that short-term momentum is almost flat. This could mean:

Bulls are losing strength, and the price could revisit the 361.80% level as support.
If there’s no significant bullish catalyst, a move lower to 261.80% might occur.
The Daily time frame momentum lagging behind the 3-Day time frame suggests that the shorter-term market activity does not yet support an imminent breakout to the upside.

Potential Scenarios:
Bearish Scenario:

The lack of momentum on the Daily time frame (low CMO and bearish MACD) suggests that the price may retest the 361.80% support level.
If this support breaks, the price could drop toward the 261.80% level, which has been a significant pullback level in the past.
Bullish Scenario:

If the price can reclaim the 400% level with volume and bullish momentum, a test of the 423.60% resistance level is likely.
A break above 423.60% could trigger further bullish continuation, but this requires alignment of both Daily and 3-Day indicators.
Neutral/Rangebound Scenario:

The asset might continue consolidating between the 361.80% and 400% levels until there’s a clear catalyst to break out of this range.
Key Insights:
Watch the Daily time frame CMO closely: The low value indicates weak short-term momentum, so any significant moves will need improvement in this indicator.
Pay attention to the 400% level: A clean breakout and daily close above this level could signal bullish strength returning.
Monitor the 361.80% level for breakdowns: If this support fails, a deeper correction becomes likely.