10 AUGUST
UPDATED 11 AUGUST
Let's make this analysis more in depth than the others, i will also try to explain a few trading concepts that will be re-used in my analysis.
We are still trading under the 50 MA line and the 200 MA line. On the chart we can see 2 dead cat bounces where the price tried to go over the 200 MA line for one hour and a sell off occured. This is a bearish sign signaling prices are going to go lower in the near future. We are also seeing lower lows one after another, this is a bearish sign.
I expect the price to fall back to 0.57 USD where the next big resistance seems to be. Of course, this is what is most likely to happen and the odds are in favor of a bearish scenario, but in trading anything can happen and you should be prepared for it.
UPDATED : We are now trading at 1.53 USD from past highs of 4.39 USD, this is normal after a parabolic move.
Breaking down after a triple bottom is very bearish as a triple bottom is normally a bullish sign. But instead of going higher prices are going lower, we should see new lows coming soon.
HELP on how to understand the charts
Under this line i explain how to understand the charts, i will use this information from now on to help you guys understand better how this whole thing works. If you understand trading and technical analysis, the below lines are useless to you.
What is the 50 MA and 200 MA and why does it matter ?
Link : http://www.investopedia.com/terms/m/movingaverage.asp
When the price is trading under the 50 MA is a bearish sign, meaning that the price should be moving lower in the future. The same goes for the 200 MA, but the 200 MA is a longer term trend, trading under the 200 MA is very bearish.
Bullish reversal, how to see it
You may want to know when the price is going to reverse, first of all the price should move over the 50 MA, then the 200 MA, once it's there, the 50 MA line should cross over the 200 MA line, if this doesn't happen, it's a bearish sign, if this does happen, it's a bullish sign.
So if you see the white line (50 MA) crossing over the orange line (200 MA), this will mean that the price of STEEM is going to go much higher and that the longer trend reversed from bearish to bullish.
Actually the white line (50 MA) is trading under the orange line (200 MA), this is a very bearish sign, meaning the price is most likely to go down. On the chart you can see that sometimes the price go over the orange line (200 MA), you may think that it's a bullish sign, but it's not. It's what we call a dead cat bounce and it's a good point to sell off your STEEM if you still have any.
Lower lows, what it is
Lower lows indicate that the trend is bearish and prices going down more and more, until a higher low happen, we can expect the prices to go down. If you look at the chart, we have only lower lows, meaning the odds of the price going higher are very unlikely.
Support points
The support is where the price in the past encountered a lot of buyers and where the price couldn't go lower. If a support is broken, we look for the next support and so on. Breaking a support one after another is a very bearish sign.
Resistance points
The resistance is where the price in the past encountered a lot of sellers and where the price couldn't go higher. If a resistance is broken the price might go much higher in the near future, it's a very bullish sign.
Parabolic move
When the price rise higher very fast this creates a parabolic move, when this happens almost always the price falls back to where it was before the move occured.
Triple bottom
Normally a triple bottom is a bullish sign. In our chart our triple bottom went down instead of going up. This is very bearish.
Fundamentals
Technical analysis is all good but not enough, it should be used with fundamentals. Fundamentals are information about the company itself, what is going on in the company, new products, financials, everything related to the company. For STEEM the company is STEEMIT, so we should be looking at STEEMIT and see how things are going.
The more power down, the less likely for the price of STEEM to go up.
The more cash outs from members, the less likely for the price of STEEM to go up.
The less retention of new users, the less likely the price of STEEM to go up.
And so on... Fundamentals are important, because even if the chart is very bearish, if the fundamentals are good, the chart will reverse at one point or another. I believe the fundamentals are not looking good today, so the bearish scenario is very likely.