Trade Recommendation: Aeron/Bitcoin
The Aeron/Bitcoin pair (ARN/BTC) started its uptrend on January 3, 2018 when it broke above 0.000075 resistance. The breakout triggered the inverse head and shoulders reversal pattern on the daily chart. This attracted momentum traders and trend followers who helped ignite an unbelievable run. On January 5, the pair skyrocketed to 0.00063222. In two days, the pair grew by almost 743%!
At this price level, the market was in extreme overbought territory. Those who bought the breakout started to dump their positions. ARN/BTC plunged to 0.00023462 on January 8.
After seeing that the market respected the 50% Fibonacci level, bottom pickers entered the buying scene and started a rally. The pair went as high as 0.0004694 on January 9 before succumbing to heavy profit taking. Since then, the market has been generating a series of lower highs and lower lows. That was the case until recent events.
Technical analysis show that ARN/BTC may have bottomed out at support of 0.00013, which is also the 23.6% Fibonacci level. Volume seems to significantly drop when the market touches this price point. It happened April 4 and it happened again on May 12. This strongly indicates that no one is interested to sell at this level. More importantly, the market’s ability to preserve the support on both occasions suggests that a firm support has been established.
The strategy is to buy as close to 0.00013 support as possible. Should bulls hold on to this support, they will continue building a base before climbing to the top end of the range and our target of 0.00025.
The process may take more than a month.
Daily Chart of Aeron/Bitcoin on Binance
As of this writing, the Aeron/Bitcoin pair is trading at 0.00015894 on Binance.
Summary of Strategy
Buy: As close to 0.00013 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.
Featured image courtesy of Shutterstock.