Compound (COMPUSD) Retraces Upward As The Third Impulse Swing Ends
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COMPUSD Analysis: The Market Retraces Upward As The Third Impulse Swing Ends
COMPUSD retraces upward as the third impulse swing ends. The prior trend was bullish until the retraction of the price at the $86.00 resistance. The market is currently in a consolidation phase as it entered an oversold state, according to the Stochastic Oscillator. The overall trend is likely to remain bearish since the COMPUSD market has yet to make its final impulse to the downside.
COMPUSD Significant Zones
Demand Zones: $23.20, $3.00
Supply Zones: $54.60, $86.00
According to the MA Cross, the market reluctantly entered the discount zone in June 2023. The decline brought the price into the $23.20 demand zone, after which the bulls seized control of the market. An impulsive upswing followed, invalidating all resistance levels until the price hit the $86.00 resistance. Owing to the overbought indication of the market at the premium, COMPUSD aggressively declined to create a new low. The new low formed at $58.30 marked the end of the first phase of the emerging bearish trend.
An upward expansion occurred, but only to face overwhelming selling pressure at the rejection block in the premium zone. The third impulse swing, which might be the longest wave, began immediately after. COMPUSD kept sinking due to overwhelming selling pressure as the market’s structure shifted downward. As revealed by the Stochastic Oscillator, the third impulse swing dragged the price into the oversold region. The bulls stormed the market afterward, causing an equilibrium moment in the market as the price now consolidated within a close range.
Market Expectation
On August 31, 2023, COMPUSD entered an oversold state according to the Stochastic Oscillator. On the four-hour chart, an FVG (Fair Value Gap) formed as the price headed downward to conclude the third impulse swing. Probably, a return to the FVG will occur before the price resumes its downtrend.
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