RSI Divergence idea for FWONALiberty Media Corporation - Series A Liberty Formula OneBATS:FWONAQJEEEThis is my technical analysis n $NASDAQ:FWONA. I want to mention that the price movements may differ greatly from my projection, and this is not a prediction. If the price moves differently, I will update the idea accordingly. https://www.tradingview.com/symbols/NASDAQ-FWONA/financials-income-statement/ Looking at the company's financials and investor relations, the most recent Q report showed acceptable numbers. I'm a technical trader more than fundamental so I don't want to get into the statistics too much. But I also acknowledge the importance, and don't want to completely neglect them - numbers being inline is good enough for me. RSI Divergence is when price and RSI moves in opposite directions, indicating the shift of momentum. For example, if price makes lower low while RSI makes higher low, this indicates that the selling pressure is slowing down, potentially opening up the trend reversal. This is what happened this March - April for $NASDAQ:FWONA. We see price making lower low while RSI rebounding on 30 line for the second time. Although this isn't exactly a divergence (more of 'double bottom'), this still suggests that the selling pressure is being weakened. We then see RSI breaking through the 45 line, opening up the bullish opportunity, with price also breaking through the price action zone (yellow), and bullish signal on MACD indicator as well. (My MACD indicator is my modified version of "MacD Custom Indicator-Multiple Time Frame+All Available Options!" created by ChrisMoody.) All these signals strengthen the possibility of an uptrend and sure enough the stock price climbed for next 3 months, reaching 96 at top. With this history, we can create our projection assuming to see the same pattern. We may expect the price to reach as low as 75 (price action level) before rebounding, while RSI creates the same 'double bottom' pattern, indicating the weakening selling pressure. If we then see price breaking through the 81 level, RSI breaking through the 45 line and MACD indicator flashing bullish signal - just like the last time, that's when we enter. We want to be absolutely sure before entering - it is dangerous to enter prior to several confirmations. Our initial selling point would be where the price nears the red resistance line, and the rest would be sold in the red resistance zone. However, this speculation is very specific and price may never reach as low as 75. When we look at this analysis, for example, there is a support line (yellow) not too below from the current price where price might rebound. Two RSI Divergence indicators below the main chart (created by Shizaru - an indicator showing a difference between fast and slow RSI) - each comparing (9,21) and (5,14) RSI are making higher lows - indicating that the selling pressure may ease up much earlier than our prior projection. In fact, the price may not even reach the yellow support line, continuing its uptrend. Next Q report is on Oct. 31st, although I do not know for sure how the result will affect the price. Prior examples have shown conflicting views on how the reports are related. I will keep the idea updated according to the price movements.