Step 1: Market State Classification – AI Decision Tree Analysis
#### Primary Branch (ADX(14)):
- ADX(14) = 27.22692511
Since 21.75627679 ≤ ADX(14) < 29.75627679, we analyze the market as a Weak Trend Market.
#### Weak Trend Market Analysis (21.75627679 ≤ ADX < 29.75627679)
- Option B: Trend Initiation State (Bullish/Bearish)
##### Check Conditions:
- Clear breakout above (bullish) or below (bearish) a key resistance or support level:
– The price is currently at 5181.22000000, which is below the 20-period high (True).
– The price is not below the 20-period low (False).
- Volume expansion confirms the breakout:
– Volume Oscillator (VO) = 2.03970839, indicating a slight increase in volume.
– Spike (>1.5x average): False, but the volume is still supportive of the current movement.
- ADX begins to rise from low levels:
– ADX(14) = 27.22692511, which is within the weak trend range and indicates a rising trend.
- Price maintains direction in the breakout’s favor for multiple bars:
– The price has been moving in a downward direction, but it is not a strong sustained move.
##### Classification:
- 3 out of 4 conditions are met (Breakout, Volume, ADX).
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 = 0.03145707 (Dynamic Bandwidth = 0.02346799)
– Condition Met: True
– Trend Initiation Bearish (Sell): Close 1.0 AND Breakout Confirmation
– Current Close = 5181.22000000
– KC Lower = 5164.28814338
– Breakout Filter = 90.51214286 (Baseline 3x ATR)
– KC Lower – Breakout Filter = 5164.28814338 – 90.51214286 = 5073.77600052
– Current Close (5181.22000000) > 5073.77600052
– VO = 2.03970839 > 1.0
– Breakout Confirmation: True
– Signal: Sell Signal
- Volume – Price Breakout of Previous High / Low
– Trend Initiation Bearish (Sell): Close 0.1%
– Current Close = 5181.22000000
– Previous 20-period Low = 5172.18000000
– Current Close (5181.22000000) > 5172.18000000
– Increased Volume: True
– Breakout Magnitude = 0.94% > 0.1%
– Signal: No Sell Signal (Condition not met)
- DMI Momentum Crossover Start
– Prerequisite: 21.75627679 ≤ ADX(14) < 29.75627679
– ADX(14) = 27.22692511
– Condition Met: True
– Trend Initiation Bearish (Sell): -DI(14) crosses above +DI(14) (Death Cross)
– +DI(14) = 15.28451894
– -DI(14) = 16.35472722
– -DI(14) > +DI(14)
– Signal: Sell Signal
#### Actionable Signals:
- Sell Signal (Volatility Squeeze Breakout)
- Sell Signal (DMI Momentum Crossover Start)
Step 3: AI Autonomous Analysis
#### Methodology:
- Pattern Recognition and Multi-Timeframe Analysis:
– Analyze candlestick patterns and technical indicators on the 5-minute timeframe.
– Consider recent price action, trend, and volatility.
#### Observations:
- Candlestick Patterns:
– Recent candles show bearish momentum with lower highs and lower lows.
– No significant bullish reversal patterns observed.
- Technical Indicators:
– RSI(14) = 35.84966169, indicating a slightly oversold condition.
– MACD Histogram = 4.45565123, showing a slight bullish divergence.
– DMI System: -DI(14) > +DI(14), confirming bearish momentum.
– Keltner Channel: Price is below the middle band, indicating bearish pressure.
#### Actionable Signals:
- Sell Signal (Bearish Candlestick Patterns and Indicators)
#### Comparison:
- Specified Model (Step 2):
– Sell Signal (Volatility Squeeze Breakout)
– Sell Signal (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:
– Final Score = (Step2_Score × 0.6) + (Step3_Score × 0.4)
– Final Score = (-1 × 0.6) + (-1 × 0.4) = -1.0
- Threshold-Based Action:
– Plan Short: Final Score ≤ -0.4
#### Stop-Loss Strategy:
- ADX = 27.22692511 (Trend Formation)
- ATR = 30.17071429
- Time Factor (UTC+8 Beijing Time 11:30): 1.0 (Asian Main Session)
- Volatility Factor (High Volatility): 1.2
- Base Multiplier: 2.8 × ATR = 2.8 × 30.17071429 = 84.47799999
- Adjusted Stop-Loss: 84.47799999 × 1.0 × 1.2 = 101.37359999
- Stop-Loss Price: 5181.22000000 + 101.37359999 = 5282.59359999 ≈ 5282.59
#### Take-Profit Strategy:
- Risk-Reward Ratio: 1.8:1 (Trend Formation)
- Swing Point: 5221.32000000 (Recent High)
- Buffer: 0.5 × ATR = 0.5 × 30.17071429 = 15.08535714
- Take-Profit Price: 5221.32000000 – 15.08535714 = 5206.23464286 ≈ 5206.23
#### Final Signal:
- Direction signal: Short
- Trade entry price: >>> 5181.22 <<<
- Signal Strength: =>> -8 <<=
- Stop-Loss price: ->> 5282.59 <<-
- Take-Profit price: +>> 5206.23 <<+
Step 5: Summarize analysis conclusions
- Market State: Trend Initiation (Bearish) | Confidence: 75%
- Actionable Signals:
– Sell Signal (Volatility Squeeze Breakout)
– Sell Signal (DMI Momentum Crossover Start)
– Sell Signal (Bearish Candlestick Patterns and Indicators)
- Trading Plan:
– Direction signal: Short
– Trade entry price: 5181.22
– Signal Strength: -8
– Stop-Loss price: 5282.59
– Take-Profit price: 5206.23
This comprehensive analysis and trading plan provide a clear and actionable strategy based on the current market conditions and technical indicators.