Trade Recommendation: aelf
The aelf/Bitcoin (ELF/BTC) pair took out resistance of 0.000058 on September 1, 2018. The breach enabled the pair to breakout from the large falling wedge pattern on daily chart. Unfortunately for breakout buyers, ELF/BTC immediately retraced. It even went as low as 0.00004593 on September 12.
Because of this price action, many would doubt the validity of the breakout. Some may even say that it was a bull trap. Be that as it may, what’s important is that ELF/BTC is showing signs of stability. This is the reason why we’re talking about this trade today.
Technical analysis shows that ELF/BTC appears to be creating a durable bottom at 0.00005 support. Bears tried their hardest to breach the support but they were exhausted. This enabled bulls to wrangle momentum away from them. You can see that the momentum is shifting as the RSI prints a bullish divergence.
An important thing to note is that the market dropped to 0.00005 support on August 14. So if ELF/BTC respects this area one more time, it can mean that a double bottom structure is in play.
The strategy is to buy as close to 0.00005 as possible. If bulls defend the support, they will attract the momentum needed to rally to our target of 0.000093.
The process may take a month.
Daily Chart of aelf/Bitcoin on Binance
As of this writing, the aelf/Bitcoin pair is trading at 0.0000512 on Binance.
Summary of Strategy
Buy: As close to 0.00005 support as possible.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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