Here is a trade setup I’m currently looking at for 0x. This coin has been known to go on some massive runs, and it appears that a bottom is being formed at the support range at October 2017 levels.
The higher the timeframe, the stronger the divergence. This is a weekly timeframe so I am willing to risk a bit more, as you can see in the trade setup we are risking 10% for a profit potential of 63% by targeting resistance around $0.44.
If you are unfamiliar with divergence, check out my post on how to spot big market moves using RSI divergence.
Another key indication is found in the MACD indicator. I would like to see higher highs on both the orange and blue lines, the former being more significant. Each resistance is marked with a blue dotted line.
Also notice the big spike in volume over the previous weeks. This indicates market pressure is building.
Because this is a weekly chart, it might take a while to play out.
