Lisk (LSK/USD) Analysis November 23, 2017
Lisk is on a roll. Last week’s explosion came after stochastics higher highs and reversal at key Fibonacci retracement levels. Compared to last week’s bullish candlestick where LSK bulls added $7, this week has been tepid to say the least.
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Even though this is in line with historical set up show, some upward movements were expected because of last week’s humongous bull pressure. As of this writing, this week candlestick is a doji with equal buy and sell pressure. Despite the suppressed movement, we are bullish since there was a break out from the bull flag and LSK managed to close above August highs of $8.6. Furthermore, there is a stochastics buy signal in place.
In the daily chart, the cause of this week’s doji is a result of those spinning tops. From recent price movement, it is clear that USD bulls reject any close above $10.7. Besides that, there is a bearish divergence in place following that over-extension on November 16 where an inverted hammer was formed.
Notice that even though prices are moving up towards the immediate resistance defined by November 16 highs of $12.28, stochastics are bearish while at the same time prices are moving lower relative to the upper BB with long upper wicks. After last week’s bullish candlestick, bulls are in command and even if prices trickle down and close below yesterday’s lows of $8.9, August highs will act as our support line.
The influence of the 20 period MA in our entry chart cannot be discounted. As observed, the flexible support line has been reliable and as LSK prices look to peak, the 20 period MA will again determine if USD bull pressure is strong enough to even push prices lower.
For USD bulls to break support or not will mainly stem from price action activities and if there will be a bearish engulfing candlestick in the next session. As we are bullish, we shall only be taking long positions in the coming sessions ONLY when the right buy opportunity presents itself.
At the moment though, our support lies between $7.8 and $8.3 respectively. However, if prices surge today and close above the main resistance trend line as marked in the chart, then our bear correction will be nullified and bulls shall be in charge.