Critical Resistance Reached, Trend Change or Short Play? INFA
Atualizado
Hi guys! This is a Technical Analysis on this relatively new company Informatica, Inc. (INFA). But the focus is not the company but rather on finding these specific trends in price action.
This analysis is done on the 1 Week timeframe.
Main takeaway is that its powerful to be able to identify when Price action reaches a Major Resistance or Support level. It can make for taking short or long positions.
Notice how INFA is in this Downward Channel.
We've had some touch points on the Support trendline in black.
With every touch, we've had Uptrends.
With our most recent touch of Support, we've had an Uptrend that brought us to our Resistance trendline in RED.
Note, this recent uptrend has created a Higher high from a previous lower higher. Good sign for trend change attempt.
We have also printed our 1st Golden Cross between the 21 EMA(Purple) and the 50 SMA (Green).
This is a powerful bullish sign, even more so that it has happened on the 1 Week. This can provide necessary momentum to break out.
Our current Price action is in a crucial zone. We are attempting to breakout of this Major Resistance trendline.
If we can break through and CONFIRM, it may indicate a Trend Change.
However, do note that this is our 2nd time directly touching this trendline. Trendline theory states it requires atleast 3 touches for that trendline to break. This being a powerful Resistance area, It is important to also look for signs of Rejection.
One sign currently is the presence of Upper Wicks of candles. This shows sell pressure off this trendline.
A Clear sign of rejection would then make this area a solid spot to take short positions.
Target being the Support line below us which coincides with the previous Lower Higher or the 21 EMA.
Now going back to if we can breakout ABOVE the Major Resistance Red Line and Confirm. Our target would be the Horizontal Resistance line Above us.
In my opinion if we can break through the horizontal resistance line. Reaching all time highs becomes very likely. As we dont have much Market Structure above.
One sign to assess if we breakout is VOLUME to increase or spike. That would show signs of increased liquidity which is what we need when trying to trend change. If we breakout with Low Volume, it may lead to a FAKEOUT.
If we reach ABOVE Major Resistance and CONFIRM, this would make for an area for Long positions especially Longer Term Positions/ Investment. This would also signify a Trend Change.
Look to the 1 Day for further signs of whats to come. I will be sure to update as well.
__________________________________________________________________________________
Thank you for taking the time to read my analysis. Hope it helped keep you informed. Please do support my ideas by boosting, following me and commenting. Thanks again.
Stay tuned for more updates on INFA in the near future.
If you have any questions, do reach out. Thank you again.
DISCLAIMER: This is not financial advice, i am not a financial advisor. The thoughts expressed in the posts are my opinion and for educational purposes. Do not use my ideas for the basis of your trading strategy, make sure to work out your own strategy and when trading always spend majority of your time on risk management strategy.
This analysis is done on the 1 Week timeframe.
Main takeaway is that its powerful to be able to identify when Price action reaches a Major Resistance or Support level. It can make for taking short or long positions.
Notice how INFA is in this Downward Channel.
We've had some touch points on the Support trendline in black.
With every touch, we've had Uptrends.
With our most recent touch of Support, we've had an Uptrend that brought us to our Resistance trendline in RED.
Note, this recent uptrend has created a Higher high from a previous lower higher. Good sign for trend change attempt.
We have also printed our 1st Golden Cross between the 21 EMA(Purple) and the 50 SMA (Green).
This is a powerful bullish sign, even more so that it has happened on the 1 Week. This can provide necessary momentum to break out.
Our current Price action is in a crucial zone. We are attempting to breakout of this Major Resistance trendline.
If we can break through and CONFIRM, it may indicate a Trend Change.
However, do note that this is our 2nd time directly touching this trendline. Trendline theory states it requires atleast 3 touches for that trendline to break. This being a powerful Resistance area, It is important to also look for signs of Rejection.
One sign currently is the presence of Upper Wicks of candles. This shows sell pressure off this trendline.
A Clear sign of rejection would then make this area a solid spot to take short positions.
Target being the Support line below us which coincides with the previous Lower Higher or the 21 EMA.
Now going back to if we can breakout ABOVE the Major Resistance Red Line and Confirm. Our target would be the Horizontal Resistance line Above us.
In my opinion if we can break through the horizontal resistance line. Reaching all time highs becomes very likely. As we dont have much Market Structure above.
One sign to assess if we breakout is VOLUME to increase or spike. That would show signs of increased liquidity which is what we need when trying to trend change. If we breakout with Low Volume, it may lead to a FAKEOUT.
If we reach ABOVE Major Resistance and CONFIRM, this would make for an area for Long positions especially Longer Term Positions/ Investment. This would also signify a Trend Change.
Look to the 1 Day for further signs of whats to come. I will be sure to update as well.
__________________________________________________________________________________
Thank you for taking the time to read my analysis. Hope it helped keep you informed. Please do support my ideas by boosting, following me and commenting. Thanks again.
Stay tuned for more updates on INFA in the near future.
If you have any questions, do reach out. Thank you again.
DISCLAIMER: This is not financial advice, i am not a financial advisor. The thoughts expressed in the posts are my opinion and for educational purposes. Do not use my ideas for the basis of your trading strategy, make sure to work out your own strategy and when trading always spend majority of your time on risk management strategy.
Nota
Update on INFA on 1 weekly.
We've broken out ABOVE "Major Resistance Red trendline" that has kept us in a downtrend since December 2021.
This is an attempt to Trend change
But we have yet to CONFIRM.
The weekly candle has a large Upper wick, indicating selling pressure.
Our current Uptrend is also Supported by a Steep trendline.
This uptrend occured through decling overall volume as seen by the downward angled Blue Moving Average of Volume indicator.
Our current break ABOVE the Major Resistance is missing signs of Volume that should support a move breaking a critical resistance line.
I need to see Volume increase further and or signs of Volume spike.
Without it, there is a potential for a Fakeout.
STOCH RSI is showing signs of a BUllish Cross, which could bring in some Bullish Momentum and hopefully bring in VOLUME.
FOr now in my opinion, im lacking clarity from fears of maybe a pullback from this area.
I will continue to monitor however, if we do see CONFIRMATION in the coming weeks ABOVE the Major Resistance, i would consider taking longs.
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