EOS Update: Preparing for a Big Bullish Move

EOS has been stuck in a range since August 8, 2018. It’s been trading between $6.65 and $4.50 with a midpoint of $5.30. If you’re a day trader, the range is wide enough to exploit and generate serious profits. However, this is not the case for many retail investors who bought the bottom and are anticipating the next big rally. They’d want to know when EOS (EOS/USD) would make another substantial move.

The good news is we are certain that it’s soon, very likely within a month. The next question would be the direction. This is something we’ll never be 100% certain of. However, we looked at the charts and we’re confident that this move will usher in a new higher high.

In this article, we reveal how this coin is preparing for a big bullish move.

Unnerving Lack of Volatility

EOS has been slowly flatlining since September 2018. The trading range has become tighter and tighter with each passing week. You can see the almost non-existent volatility in the weekly RSI. The indicator has moved within a three-point range (42 – 45) in the last two months.

Weekly RSI range

In addition to the weekly RSI, the daily trading range has been suffocating. The last time Bollinger bands were this tight was about a year ago. It was at the point before EOS launched a massive bull run.

Daily Chart

Before you get excited, we have to be clear that narrow trading ranges do not necessarily foretell a bull run. However, it is a prelude to a big move. It is the proverbial calm before the storm. The storm, we believe, will nourish the bellies of starving bulls.

Alleviating Resistance to Support (RS) Flip

EOS has a diagonal trendline that cuts through both the bull and bear runs. The trendline started to exist on January 20, 2018 when it acted as resistance and prevented the market from going above $15.75. The first RS flip happened on April 24 when EOS breached resistance of $12.00. This helped the market climb to $23.029 on April 29.

The diagonal trendline continued to serve as a support for EOS until June 22 when the market breached support of $9.50. This effectively flipped the support into resistance. EOS worked very hard to take back the diagonal trendline but to no avail. As a result, the market dropped to lows of $4.1778.

Diagonal trendline

The price action described above illustrates the impact of this trendline. It provides massive resistance when the market is below it. On the other hand, it offers firm support when EOS traded above it. Thus, the market would have been in a bad shape now if bulls would not have put up a strong fight. Luckily, they did.

With a series of higher lows, bulls eventually flipped the resistance into support on September 27. They also completed the retest when EOS dropped to $5.0014 on October 11. This tells us that bulls are mobilizing. It looks like they are quietly and patiently accumulating at these levels.

Promising Inverted EOS Chart

If you’re having trouble believing that EOS is starting to look bullish, then allow us to present to you the inverted chart. One look and you’ll know that this chart is prime for massive shorting.

Inverted weekly chart

This inverted chart looks like it already topped out. It tried really hard to take out resistance of $3.50 but it failed again and again. Its inability to breach the resistance led to exhaustion. You can see the rally fading in the declining volume. The market persistently rose even if volume steadily decreased. This is not a sustainable ascent.

As a result, the market appears to have broken down of an ascending triangle pattern. It is currently retesting the resistance but without volume, it is likely that the market will resume its descent. When it does, EOS will make its big move.

Bottom Line

With volatility almost non-existent, EOS appears to be preparing for a massive move. While this is something we are certain of, the direction is still not guaranteed. However, the recent RS flip of the diagonal downtrend and the inverted weekly chart make us believe that EOS is gearing up for a big bullish move.

Kiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and funds, as he does his own crypto research and is a Product Manager at Mitre Media. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.