Trade Recommendation: Komodo

Komodo

Komodo (KMD/BTC) has returned to range accumulation between 0.00014 and 0.00022 with a midpoint of 0.00018. The market was able to go above that range for a couple of months between February to April 2019. Unfortunately, bulls failed to flip 0.00022 resistance into support. The inability to do so put tremendous selling pressure on the market which drove the pair to just below the range low of 0.00014 on May 13th.

Nevertheless, bulls made a strong push back. They rallied and catapulted the market back to just over the range high of 0.00022 on June 8th. Although the market looks bullish, we think it needs one more pullback before it moons. During the pullback is likely the best time to enter long positions.

Technical analysis shows that KMD/BTC is painting an inverse head-and-shoulders on the daily chart. We have this view because the market failed to take out 0.00022 resistance after multiple attempts between June 8th to 10th. With bears holding their ground, Komodo is likely headed to our range midpoint of 0.00018.

In addition, the daily RSI is flashing overheated signals. The overbought conditions will discourage buyers from making a push. This makes it easier for bears to drive the market down.

The strategy is to buy on dips as close to 0.00018 as possible. As long as KMD/BTC is above this level, bulls will likely retarget 0.00022. Take that out and the next target is 0.000288.

The process may take a month.

Daily Chart of Komodo/Bitcoin on Binance

Komodo chart
As of this writing, the Komodo/Bitcoin pair is trading at 0.0002077 on Binance.

Summary of Strategy

Buy: As close to 0.00018 as possible.
Targets: 0.00022 and 0.000288.
Stop: 0.00017

 

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.