Trade Recommendation: Lisk/Ethereum
The Lisk/Ethereum pair (LSK/ETH) took out resistance of 0.01 on August 15, 2018. This enabled the market to break out from the large falling wedge on the daily chart. The breakout ignited a rally that saw the pair climb to as high as 0.01952549 on September 9. In less than a month, LSK/ETH grew by over 95%.
The tremendous surge in such a short period of time emboldened breakout players and bottom pickers to take profits. As sellers dumped positions, the market dropped to 0.01366334 on September 22. The good news is that this dump is giving us an opportunity to buy the dip. Those who missed the breakout rally can get in while the market is still in the early stages of its bull run.
Technical analysis shows that LSK/ETH is creating a bullish flag on the daily chart. It appears that the consolidation is still ongoing and a breakout is not yet on the horizon. Actually, the market just respected the resistance of the flag. This provides us with the chance to bottom fish the market.
In addition, the daily RSI is also respecting immediate resistance of 56. This is another clue that LSK/ETH has more downside potential before it can resume its uptrend.
The strategy is to buy on dips as close to 0.012 as possible. LSK/ETH has a firm support at that level. The market will likely use it to stage a breakout rally. Once the breakout from the pattern is complete, the pair will likely move to our target of 0.025.
The process may take more than a month.
Daily Chart of Lisk/Ethereum on Binance
As of this writing, the Lisk/Ethereum pair is trading at 0.0143 on Binance.
Summary of Strategy
Buy: As close to 0.012 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.