Sive Morten
Special Consultant to the FPA
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Sive, you have mentioned in the previous post that the 4H trend has changed to bearish based on MACDp/price cross, but the price did not go down.
I suppose that is what some people call high dynamic pressure. Can you tell us more about application of this phenomenon? Is it expected that the rally up will be at the next MACD cross up or just anytime? what are som other applications?
Thanks,
Rasto
Hi Rasto,
Not neccesary particlular rally, this Dynamic Pressure (DP) suggests that at least previous highs will be reached. How far this move can be - this is you should estimate via other tools, ABC's for example...DP itself doesn't show the potential level of possible move. And better to use it in conjunction with other tools. For example - DP at support has more chances to show up move, then without support etc...
Also it's not neccesary to wait until market will confirm DP with trend shift on the side of DP. Just be aware of negative scenario - if, suppose market shows positive DP (Like we have), and then, bearish price action starts to realize - then DP will be canceled.