This 4-hour chart for CRCL illustrates a classic "impulse and correction" pattern within a powerful uptrend. After a parabolic surge to a peak near $300, the asset is now in a healthy pullback, seeking to establish a new level of support before its next potential move. The key question for traders is whether this correction is a pause or a reversal, and the chart provides critical levels to watch.
The Bullish Thesis:
A Confluence of Support
The primary area of interest is the $160 to $170 zone. This is not just a random level; it represents a powerful confluence of four distinct technical indicators, making it the most critical support zone to watch:
1. Previous Breakout Level: This zone was a clear area of prior resistance. Following the principle of "resistance becomes support," the price is now retesting this level from above, which is a classic bullish confirmation pattern.
2. Fibonacci Golden Pocket: The retracement from the recent high finds the 0.618 Fibonacci level—often called the "golden pocket" and a prime target for buying in an uptrend—located at approximately $153. The 160−170 zone sits just above this, making it the logical area for buyers to step in.
3. Ascending Trend Channel: The price action is contained within a well-defined ascending channel. The lower boundary of this channel, which has provided support throughout the uptrend, is currently intersecting with this key price zone.
4. Anchored VWAP: The light blue line, an Anchored Volume Weighted Average Price (AVWAP) starting from the beginning of the rally, is also trending directly into this support zone. Price holding above the AVWAP signifies that the average buyer from the start of the move is still in profit, which is a strong sign of underlying trend health.
The "Last Stand" Support
Should the primary support fail, the chart highlights a secondary, more significant demand zone at $110 to $120. This is identified as the Point of Control (POC) from the volume profile on the left. The POC represents the price level where the most trading volume has occurred, signifying it as an area of "fair value" and a magnet for price. A drop to this level would represent a much deeper correction but would likely be met with significant buying pressure.
Conclusion and Key Scenarios
Bullish Scenario: The most immediate bullish outcome is for the price to find a bottom within the 160−170 support zone. A strong bounce from this area, confirmed by bullish candlestick patterns and increasing volume, would signal the end of the correction and a likely continuation of the primary uptrend, with the previous high near $300 as the next logical target.
Bearish Scenario: A decisive break and close below the $160 level on the 4-hour chart would be a significant warning sign. This would invalidate the immediate bullish structure and open the door for a deeper retrace towards the Point of Control at 110−120.
In summary, CRCL is at a critical juncture. The chart is constructively poised for a continuation of its uptrend, but traders should watch the 160−170 confluence zone as the definitive line in the sand.
Disclaimer:
The information provided in this chart is for educational and informational purposes only and should not be considered as investment advice. Trading and investing involve substantial risk and are not suitable for every investor. You should carefully consider your financial situation and consult with a financial advisor before making any investment decisions. The creator of this chart does not guarantee any specific outcome or profit and is not responsible for any losses incurred as a result of using this information. Past performance is not indicative of future results. Use this information at your own risk. This chart has been created for my own improvement in Trading and Investment Analysis. Please do your own analysis before any investments.
The Bullish Thesis:
A Confluence of Support
The primary area of interest is the $160 to $170 zone. This is not just a random level; it represents a powerful confluence of four distinct technical indicators, making it the most critical support zone to watch:
1. Previous Breakout Level: This zone was a clear area of prior resistance. Following the principle of "resistance becomes support," the price is now retesting this level from above, which is a classic bullish confirmation pattern.
2. Fibonacci Golden Pocket: The retracement from the recent high finds the 0.618 Fibonacci level—often called the "golden pocket" and a prime target for buying in an uptrend—located at approximately $153. The 160−170 zone sits just above this, making it the logical area for buyers to step in.
3. Ascending Trend Channel: The price action is contained within a well-defined ascending channel. The lower boundary of this channel, which has provided support throughout the uptrend, is currently intersecting with this key price zone.
4. Anchored VWAP: The light blue line, an Anchored Volume Weighted Average Price (AVWAP) starting from the beginning of the rally, is also trending directly into this support zone. Price holding above the AVWAP signifies that the average buyer from the start of the move is still in profit, which is a strong sign of underlying trend health.
The "Last Stand" Support
Should the primary support fail, the chart highlights a secondary, more significant demand zone at $110 to $120. This is identified as the Point of Control (POC) from the volume profile on the left. The POC represents the price level where the most trading volume has occurred, signifying it as an area of "fair value" and a magnet for price. A drop to this level would represent a much deeper correction but would likely be met with significant buying pressure.
Conclusion and Key Scenarios
Bullish Scenario: The most immediate bullish outcome is for the price to find a bottom within the 160−170 support zone. A strong bounce from this area, confirmed by bullish candlestick patterns and increasing volume, would signal the end of the correction and a likely continuation of the primary uptrend, with the previous high near $300 as the next logical target.
Bearish Scenario: A decisive break and close below the $160 level on the 4-hour chart would be a significant warning sign. This would invalidate the immediate bullish structure and open the door for a deeper retrace towards the Point of Control at 110−120.
In summary, CRCL is at a critical juncture. The chart is constructively poised for a continuation of its uptrend, but traders should watch the 160−170 confluence zone as the definitive line in the sand.
Disclaimer:
The information provided in this chart is for educational and informational purposes only and should not be considered as investment advice. Trading and investing involve substantial risk and are not suitable for every investor. You should carefully consider your financial situation and consult with a financial advisor before making any investment decisions. The creator of this chart does not guarantee any specific outcome or profit and is not responsible for any losses incurred as a result of using this information. Past performance is not indicative of future results. Use this information at your own risk. This chart has been created for my own improvement in Trading and Investment Analysis. Please do your own analysis before any investments.
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.