Trade Recommendation: DigixDAO

The DigixDAO/Bitcoin pair (DGD/BTC) came off lows of 0.005045 on September 12, 2018. At this price, the market was down by over 93% from the 2018 high of 0.081. This puts DGD/BTC on the list of the worst altcoin performers in 2018.

While it is tempting to write off DGD/BTC, the reality is that the market is now trading at a very affordable price. This is one of the reasons why we kept the pair on our watchlist. We wanted to see if someone will start accumulating positions. We got this signal on September 14 when volume spiked to over 516% of its daily average. Such a surge in volume is definitely not a blip.

Technical analysis shows that DGD/BTC is carving a bottom at 0.0054. This price area is the market’s historic support. Thus, we can expect bulls to fight tooth and nail to defend this territory. So far, they’ve been successful. The market has managed to stay above this support for a couple of weeks now.

In addition, we can see on the daily RSI that bulls are starting to gather momentum. The market generated a bullish divergence. As a result, DGB/BTC pierced immediate RSI resistance of 38 and turned it into support.

The strategy is to buy as close to 0.0054 support as possible. As long as the market is above this level, there’s a very good chance that it will rally our target of 0.0095.

The process may take a month.

Daily Chart of DigixDAO/Bitcoin on Binance

As of this writing, the DigixDAO/Bitcoin pair is trading at 0.005757 on Binance.

Summary of Strategy

Buy: As close to 0.0054 support as possible.

Target: 0.0095

Stop: 0.0052

 

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.