Trade Recommendation: Bread/Bitcoin

The Bread/Bitcoin pair took out resistance of 0.00005 on September 17, 2018. This triggered the breakout from the falling wedge on the daily chart. The price action attracted more bargain hunters and momentum traders. The surge in demand enabled the market to climb to as high as 0.0000761 on October 4.

Unfortunately for buyers at that level, the rally faded. Those who bought the bottom and the breakout used the rally to take profits. You can see the heavy selling on the long wick above the daily candle’s body. This also suggests that BRD/BTC is not yet ready to take its bull run to another level. While others may see this as weakness in the market, we see it as an opportunity to enter at the early stages of a bull run.

Technical analysis shows that BRD/BTC is currently correcting from its breakout rally. This is actually positive news because the pullback keeps the bull run healthy. It allows the market to create a new base of buyers who would hold positions near the breakout. This would strengthen the idea that the market is bullish as participants are no longer waiting for the bottom before buying positions.

The strategy is to buy on dips as close to 0.00005 as possible. The market is currently creating a firm support that should keep the uptrend alive. As long as BRD/BTC respects that support, it has all the momentum it needs to rally to our target of 0.000075.

The process may take more than a month.

Daily Chart of Bread/Bitcoin on Binance

As of this writing, the Bread/Bitcoin pair is trading at 0.00005707 on Binance.

Summary of Strategy

Buy: Buy on dips as close to 0.00005 as possible.

Target: 0.000075

Stop: 0.000049

 

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.

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.