If we look at the 4H chart of NEO, we can see a trend reversal chart pattern. Head & Shoulders pattern on the top gives a signal that the market is going to move downward. For confirmation this price movement, we'll need a price breakout below the signal line of H&S pattern. If so, the market will be able to drop to 15.50 level. For reaching this target based on H&S, the market will have to pass through several support levels. We'll have to watch closely for price action near these levels, because they willl be able to give us new buy signals. We'll have to be ready open long trades based on confirmed reversal signals from 30.50, 21.50 and 15.50 levels. Alternative, if the price bounces from support zone formed by 40.50 and 38.00 support levels, we'll see a new upward movement. RSI will have to confirm price reversal. For confirmation the main uptrend, we'll need a price breakout above 52.30 level. Pending orders for buy can be placed at this level.
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The market breaks the support zone. We should watch for price action near 32.00 level and the main uptrend line. If the market bounces from this zone, we'll have a new buy signal. If the market drops below, probably we'll have further downward movement to 21.50 support level.
@DLavrov Please correct me if I am wrong, I see price bounced and RSI has confirmed price reversal from support zone, this means we can open long trades over the 52.3 level? or still to early?
A.C.
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Thank you...NEO has been a beast over the past few weeks. Your analysis looks spot on. It will be interesting to see any additional announcements from the team. The tech is good and the Chinese market is huge. Thanks again,
DLavrov
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@a.C., NEO has a huge potential for upward movement. You are right, the tech is good and Chinese market is huge.
vickygautam
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@DLavrov, When you say NEO has huge potential, is it based on just fundamentals? Is there anything in Technical analysis that can help to determine an instruments potential in future?
steve08
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@DLavrov, Neo is at $35 now. Do I take some profit or buy more? The technical analysis is good, but it's too much for me to grasp.