ALTS: Short the Bounce Into Overhead Supply — Targeting 5.60s as Wave C Unfolds

ALTS – multi-timeframe technical read and 24h trade plan

Summary view

• Bias next 24h: Bearish-to-neutral with a high-probability sell-the-rip setup. Expect a weak bounce toward prior intraday supply (6.20–6.45) followed by renewed pressure toward the mid–5.60s, with tail risk to 5.12 if support fails.
• Structure: Post-blowoff distribution since early June highs (~10), sharp volatility shock 8/11–8/12 on outsized volume, then a two-day relief rally (8/13–8/14) and fresh breakdown today (8/15) closing near the 61.8% retrace of the 8/12–8/14 bounce.
• Trade idea: Short a rebound into the 6.25–6.35 supply zone; target 5.60s.

Price/volume context

• Regime shift 8/11–8/12: Massive volume (8/11 ~57.96M; 8/12 ~29.47M) created a high-volume node around 6.00–6.60. These heavy-value areas often act as magnets and resistance once price sits below them.
• Today (8/15) intraday: Opened heavy, persistent supply. Low 5.86, late bounce to ~6.10. Session largely below VWAP; consistent lower highs/lows; closing sub-VWAP suggests weak hands into the close despite a small after-hours uptick (~6.0992).
• Daily distribution: Since 8/08 peak (~8.97), sequence of lower highs (8.97 → 7.21) and lower lows (5.12 on 8/12, then 5.86 today), with expanding ADX-like momentum—classic markdown leg resuming.

Key levels (confluence)

• Resistance/supply: 6.23–6.46 (intraday rejection band 8/15; aligns with anchored VWAP zones from 8/15 and HVN ledge from 8/11–8/12), 6.70–6.90 (prior balance and 20D mid-band vicinity), 7.20–7.35 (8/14 close and pre-breakdown base).
• Support: 5.90–6.00 (golden pocket from 8/12–8/14 bounce), 5.57–5.60 (78.6% retrace and measured move confluence), 5.12 (capitulation low 8/12).
• Pivots for next session (using 8/15 H=7.30, L=5.86, C=5.94): PP ≈ 6.37, R1 ≈ 6.87, S1 ≈ 5.43. Closing below PP tilts probabilities to rallies being sold into.

Trend and momentum toolkit

• Moving averages (approx): Price below 20D SMA (~6.9–7.1) and well below 50D (~8+). Fast MAs crossed below slow—bearish alignment. Any rally into the 20D area likely meets supply.
• RSI (daily, est): Mid-30s to low-40s. Not deeply oversold today (was more extreme near 8/12), leaving room for further downside before mechanical mean reversion triggers.
• MACD (daily): Bearish cross after 8/12 break; histogram negative and expanding again post 8/14. Momentum supports sell-the-bounce.
• ADX/DI: Rising ADX with -DI > +DI suggests a strengthening downtrend—the environment to favor continuation setups over knife-catch longs.
• Bollinger Bands (20D): Bands remain expanded post-vol-shock; price rides lower half and closed near the lower band zone. That allows a reflex pop but still within a bearish band-walk context.
• Keltner Channels/ATR: ATR(14) roughly ~1.0–1.3, indicating intraday swings of 10–20% are not outliers. Position sizing must respect elevated volatility.
• Parabolic SAR: Above price—bearish bias.
• Ichimoku (daily, qualitative): Price below cloud, and both conversion/base lines above price. Cloud ahead likely red and wide—downtrend intact.

Pattern/price action diagnostics

• Fibonacci: From 8/12 low (5.12) to 8/14 high (7.21), 61.8% sits ~5.92–5.93 (today’s close ~5.94). 78.6% sits ~5.57–5.60 (next high-probability magnet if 5.90 fails). Golden pocket test suggests a modest bounce is plausible before continuation.
• Measured move/AB=CD: A-B (7.21→5.86 ≈ -1.35). A proportional C-leg from a 6.25–6.35 lower-high would project toward ~5.00–5.10 extremes; conservative symmetry points to mid–5.60s first.
• Elliott/Wave framing (heuristic): (A) 8/08–8/12 markdown, (B) 8/12–8/14 corrective rally, (C) 8/14–? now in progress. C often targets 100–127% of A measured from B; 100% aligns around 5.6–5.7; 127% nearer 5.3–5.4.
• Wyckoff lens: Upthrust-after-distribution around 8/07–8/09, Sign of Weakness 8/11–8/12, Last Point of Supply around 7.2–7.3 (8/14). Today’s action reads as markdown continuation with a weak end-of-day bounce.
• Candlestick/Intraday: Trend day down with rejection wicks at each attempt to reclaim VWAP; late-day stabilization around 5.90–6.05 suggests bounce risk but not reversal evidence.

Volume/flow and profile

• OBV/Volume Delta (qualitative): OBV trending lower since 8/08; down days’ volume dominating up days—distributional. The 6.0–6.6 node (very high volume from 8/11–8/12) is now overhead supply; expect sellers to defend that band.
• Volume profile: HVN ~6.0–6.6; LVN pocket ~5.6–5.9; if 5.90 is lost, price can slip quickly to 5.60s before encountering meaningful bids.

Relative/mean-reversion angles

• Z-score vs 20D mean likely around -0.8 to -1.2; that permits a bounce but does not force one. With trend intact, mean reversion is secondary to sell-the-rip.
• Seasonality/weekend effect: Mondays after high-vol Fridays often open with a liquidity vacuum that favors early pops into resistance followed by trend continuation.

Risk mapping and scenarios (next 24h)

• Base case (55%): Early bounce toward 6.25–6.35, fail near anchored VWAP/resistance, roll over to 5.60–5.70; close sub-6.00.
• Alt scenario (30%): Deeper squeeze to 6.45–6.60 (tagging R1 neighborhoods/20D mid-band underside) before failing; path then similar toward 5.70s but may take longer.
• Low-prob (15%): Clean reclaim above ~6.70 with acceptance; in that case, trend changes short-term and we reassess (invalidates the short setup).

Confluence for the short setup

• Structural downtrend, negative momentum, price below key MAs and VWAP.
• Sitting under a massive high-volume shelf (6.0–6.6) that should act as supply when tested from below.
• Fibonacci, measured move, and profile all point to 5.57–5.70 as the next magnet if 5.90 gives way.

Execution plan (tactical)

• Entry: Place a limit to short in the 6.25–6.35 supply pocket; optimal price 6.28–6.32 has the best fill probability and R:R.
• Profit target: 5.62 (front-running the 5.57–5.60 confluence to improve fill odds before reactive buyers).
• Stop (not requested but recommended): 6.64 (above 8/15 intraday supply and near a squeeze trigger), yielding ≈1:2.1 to ≈1:2.5 R:R depending on exact fill.
• Time-in-force: Good-till-cancel for the next session; pull if the market gaps below 5.80 at open (then look for a failed bounce to re-enter).

What would change my mind

• Strong open, sustained reclaim of 6.45–6.60 with volume and VWAP hold; then a daily close above ~6.70 would indicate demand absorption and a shift toward a long setup targeting 7.20+.

Bottom line

• Given the prevailing downtrend, overhead supply, and fresh momentum breakdown, the higher-probability play for the next 24 hours is Sell (short) a rebound into 6.25–6.35, targeting the 5.60s.