Step 1: Market State Classification – AI Decision Tree Analysis
#### Primary Branch (ADX(14)):
- ADX(14) = 29.45803802
Since ( 26.40777385 leq text{ADX(14)} < 34.40777385 ), we analyze the market as a Weak Trend Market.
#### Weak Trend Market Analysis (26.40777385 ≤ ADX < 34.40777385)
- Option B: Trend Initiation State (Bullish/Bearish)
Check Conditions:
- Clear breakout above (bullish) or below (bearish) a key resistance or support level:
– Below 20-period Low: True
– Above 20-period High: False
– Magnitude of Breakout: 0.47%
- Volume expansion confirms the breakout:
– Spike (>1.5x average): False
– Ratio: 1.25
- ADX begins to rise from low levels:
– Current ADX(14): 29.45803802
– Trend: Rising, but not from very low levels
- Price maintains direction in the breakout’s favor for multiple bars:
– Price Change: -48.69
– Direction: Bearish
Classification:
- 3 out of 4 conditions confirm trend initiation.
- Market State: Trend Initiation (Bearish) | Confidence: 75%
Step 2: Specified Model Quantitative Analysis
#### Models for Option B: Trend Initiation State (Bullish/Bearish)
- Volatility Squeeze Breakout
– Prerequisite: BB Width < Dynamic Bandwidth Threshold
– BB Bandwidth: 0.02092707
– Dynamic Bandwidth: 0.02306286
– Condition Met: No (0.02092707 > 0.02306286)
– Signal: None
- Volume – Price Breakout of Previous High / Low
– Trend Initiation Bearish (Sell): Close 0.1%
– Close: 5300.62
– Previous 20-period Low: Below 20-period Low (True)
– Increased Volume: Spike (>1.5x average) (False)
– Breakout Magnitude: 0.47% (True)
– Signal: Sell
- DMI Momentum Crossover Start
– Prerequisite: 26.40777385 ≤ ADX(14) < 34.40777385
– Condition Met: Yes
– Trend Initiation Bearish (Sell): -DI(14) crosses above +DI(14) (Death Cross)
– +DI(14): 10.71006441
– -DI(14): 26.96148468
– Condition Met: Yes
– Signal: Sell
Actionable Signals:
- Sell Signal (Volume – Price Breakout of Previous High / Low)
- Sell Signal (DMI Momentum Crossover Start)
Step 3: AI Autonomous Analysis
#### Methodology:
- Pattern Recognition and Multi-Timeframe Analysis:
– Candlestick Patterns: Bearish engulfing, bearish harami, and other bearish reversal patterns.
– Indicators: RSI, MACD, ATR, and DMI.
– Timeframe Considerations: Asian Session (09:00-14:00) with lower volatility thresholds.
Analysis:
- Candlestick Patterns:
– Bearish Engulfing: Present at 09:55, 09:50, and 09:45.
– Bearish Harami: Present at 09:40 and 09:35.
- Indicators:
– RSI(14): 32.54622136 (Oversold, but not extremely)
– MACD Histogram: -6.08178759 (Below Signal Line, indicating bearish momentum)
– ATR(14): 27.85857143 (Moderate Volatility)
– DMI System: -DI(14) > +DI(14) (Bearish Confirmation)
High-Confidence Trading Signals:
- Sell Signal (Bearish Candlestick Patterns and Indicators)
Comparison:
- Specified Model (Step 2): Sell Signal (Volume – Price Breakout of Previous High / Low, DMI Momentum Crossover Start)
- Autonomous AI Analysis (Step 3): Sell Signal (Bearish Candlestick Patterns and Indicators)
Step 4: Generate 1 trading signal based on the confirmed trading plan
#### Weighted Decision Matrix:
- Specified Model (Step 2): Sell Signal (+1)
- Autonomous AI Analysis (Step 3): Sell Signal (+1)
Final Score Calculation:
- Step2_Score × 0.6: 1 × 0.6 = 0.6
- Step3_Score × 0.4: 1 × 0.4 = 0.4
- Final Score: 0.6 + 0.4 = 1.0
Threshold-Based Action:
- Plan Short: Final Score ≥ 0.4
Stop-Loss Strategy:
- ADX: 29.45803802 (Normal Ranging)
- ATR: 27.85857143
- Base Multiplier: 3.0 × ATR = 3.0 × 27.85857143 = 83.57571429
- Time Factor (Asian Main Session): 1.1
- Volatility Factor (Normal Volatility): 1.0
- Final Stop-Loss: 83.57571429 × 1.1 × 1.0 = 91.93328572
Take-Profit Strategy:
- Risk-Reward Ratio by ADX: 1.3:1
- Swing Points: Use previous 15-30 bars
- Buffer: 0.5 × ATR = 0.5 × 27.85857143 = 13.929285715
- Take-Profit: 5300.62 – 91.93328572 – 13.929285715 = 5194.757428565
Final Signal:
- Direction signal: Short
- Trade entry price: >>> 5300.62 <<<
- Signal Strength: =>> -10 <<=
- Stop-Loss price: ->> 5392.55 <<-
- Take-Profit price: +>> 5194.76 <<+
Step 5: Summarize analysis conclusions
- Market State: Trend Initiation (Bearish) | Confidence: 75%
- Key Indicators:
– ADX(14): 29.45803802 (Weak Trend)
– RSI(14): 32.54622136 (Oversold)
– MACD Histogram: -6.08178759 (Bearish)
– -DI(14) > +DI(14): Bearish Confirmation
- Candlestick Patterns:
– Bearish Engulfing and Bearish Harami: Confirmed Bearish Trend
- Trading Signal:
– Short Signal: Entry at 5300.62, Stop-Loss at 5392.55, Take-Profit at 5194.76
- Risk Management:
– Stop-Loss: 91.93328572
– Take-Profit: 1.3:1 Risk-Reward Ratio
This comprehensive analysis confirms a strong bearish trend initiation, supported by both technical indicators and candlestick patterns, leading to a high-confidence short trade.