Trade Recommendation: Eidoo (EDO)
Eidoo (EDO/USD) is a market that looks ready to break out of range accumulation. We have this view because the crypto token has been trapped in base building mode for over eight months now. Throughout this period, Eidoo has been trading between a wide range of $0.60 and $1. Recently, the cryptocurrency has shown signs of strength, which is why we’re interested in it.
Technical analysis shows that EDO/USD is positioning to take out range high of $1. We have this view for several reasons.
First, EDO/USD has briefly breached the range resistance of $1 on June 18, 2019. However, bulls failed to convert the former resistance into support. As a result, the market is back trading inside the range.
The good news though is that Eidoo has managed to stay above the range midpoint of $0.80. With this move, the cryptocurrency appears to have established a bullish higher low setup to form the right shoulder of an inverse head-and-shoulders pattern.
Lastly, the range high of $1 has been tapped three times this year. This supply area is almost drained. Thus, we believe the next leg up will likely take out the resistance for good.
The strategy is to buy on the breakout and retest of $1 as support. As long as EDO/USD trades above this level, it will likely rally to our target of $1.20. Take that out and $1.40 is next.
The process may take more than a month.
Daily Chart of Eidoo/US Dollar on Bitfinex
Summary of Strategy
Buy: On the breakout and retest of $1 as support.
Target: $1.20 and 1.40.
Stop: $0.96 after the breakout.
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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