Technical Analysis and Market Entry: IOTA (MIOTA) Bulls have an Opportunity to Shoot Higher

  • The IOTA (MIOTA) price has been cooling over the last few sessions; however, it does remain supported for further upside.
  • MOITA/USD is being supported by an ascending trend line, which has been in play since 17th May.

MIOTA: Recent Price Behavior

IOTA’s MIOTA has been kept at bay for much of June; the bulls have bee struggling to break out to the upside like some of its peers. The price is moving within a narrow range, the low down at $0.4200 and the high up at $0.4800. Consolidation that is observed isn’t too surprising, following the high volatile trading seen last month.

MIOTA had jumped as much as 100%, rallying from $0.2750 up to $0.5525. It was the highest the price had been since October 2018, before the sellers pilled in. A pullback was seen after running into supply within the $0.5000-0.5500 range. It is the final barrier in the way of the price returning to the $0.6000 territory.

MOITA/USD daily chart.

Bullish Flag

Price action has been moving within a bullish flag structure since the middle of May. The pole of the pattern was the strong drive north from 11-15th May. There was a brief fake-out period from the flag seen between 28th May to 2nd June; however, the price fell back within on 3rd June. The price has remained inside of its confinements, since losing the momentum of that initial breakout north.

More Efficient IOTA Algorithm

The IOTA Foundation recently announced a research paper, which detailed an upcoming new, improved algorithm. Its goal is to better the network’s capability of beating spam attacks, in addition to the build-up of congestion. The new algorithm does have the qualities of bitcoin’s proof-of-work and Ethereum’s new proof-of-stake algorithm, which is under development.

A senior research scientist at IOTA, Dr. Luigi Vigneri, co-authored the paper, named “Achieving Fairness in the Tangle through an Adaptive Rate Control Algorithm.”

Firstly, each transaction will require a computer to expend resources on the proof-of-work-puzzle. Secondly, there will be increased difficulty for the puzzles sent over a specified time period. Lastly, the sender can stake IOTA, acting as collateral to reduce the overall complexity of these puzzles.

Trade Recommendation

At the time of writing, the bears are testing the key lower supporting trend line of the flag. Should a daily closure occur below the support, then a fresh wave of selling pressure may be seen. The area to note is $0.4250-00; if the daily can hold, then longs could be taken from here, given the prior proven reliance of this trend line.

If it fails to hold, the next major zone of demand is seen from $0.3450 down to the $0.3250 range. Another opportunity for an entry within this range could be provided, upon the price settling within. In terms of upside targets; $0.5200, $0.6200 and then $0.7000 are eyed. Stops on the first noted entry would be $0.4000, otherwise, $0.3000 upon the latter noted entry point.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Author:
Ken has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.