Thoughts on ChatGPT’s Chart analysis and Trade?

I had ChatGPT 4o analyse GALAUSDT On a 4 hour and 15 minute timeframe and generate whether or not to take a position at the current price. It also told me where to put my stop loss and take profits.

I also told it to analyze its own trade prior to how it played out (Still going) and it gave itself a confidence level of 6.5/10 on the trade winning, here’s its full response:

“Based on the charts:

Recommendation: Sell (Short)

Here’s why: 1. 4-Hour Timeframe (Macro Perspective): • The coin is in a clear downtrend with lower highs and lower lows, indicating bearish momentum. • Volume on upward moves appears weaker compared to sell-offs, which suggests limited buying pressure. 2. 15-Minute Timeframe (Micro Perspective): • Price is consolidating near recent lows without showing a strong bounce, a sign that sellers still dominate. • The moving averages (likely EMAs or VWAP) on the 15-minute chart are trending downward, reinforcing short-term bearishness. 3. Lack of Reversal Signs: • There are no clear bullish divergences or bottoming patterns on either timeframe, meaning a reversal isn’t evident yet.

Here’s how I would position the trade based on your short at 0.03334:

Stop Loss: • Place your stop loss slightly above the nearest resistance level to reduce risk if the trade moves against you. • Suggested stop loss: 0.03420 • This level provides some buffer above recent consolidation and accounts for potential wicks without stopping you out prematurely.

Take Profit: • Use the most recent support levels or Fibonacci retracements to determine logical exit points. • Suggested take profit levels: 1. 0.03250 (First target): • This is a reasonable short-term support zone, allowing you to lock in partial profits. 2. 0.03180 (Second target): • This aligns with a larger support zone from the 4-hour chart, representing a stronger potential for further downward movement.

Risk-Reward Ratio: • With a stop at 0.03420 and take profit at 0.03250, your risk-reward ratio is ~1:2, which is acceptable. • If the price breaks below 0.03250, let the trade run to 0.03180 for an improved overall ratio.

Trade Management Tips: • Consider trailing your stop loss lower after the price breaks below 0.03250 to lock in profits. • Monitor volume and price action closely near take profit levels. If you see signs of strong buying pressure, exit early.

Good luck with the trade!”

End