Trade Recommendation: Maker
Maker (MKR/USD) is a market that can make its intentions clear in the next few days. We say this because Maker is about to revisit a critical price area. If it stays above that level, the market remains bullish. Otherwise, Maker goes back to hibernation.
Technical analysis shows that Maker/US Dollar is headed to support of $535. A quick look at the daily chart shows that Maker has referred to this price area multiple times since May 2018. The most recent interaction is the market’s breach of this level as resistance on February 17, 2019. This triggered the breakout from a double bottom pattern on the daily chart.
Sparked by the breakout, Maker rallied to as high as $928 on April 2nd. Throughout this breakout rally, MKR did not retest $535 as support. Therefore, the expected retest of $535 should be healthy for the long-term sustainability of the market.
Now, $535 is likely to be preserved for several reasons. First, Maker is close to oversold conditions. At the very least, we can expect a relief bounce once the market touches the support. Also, this is the first time after the double bottom breakout that MKR will tap $535 as support. Thus, demand at this level is not yet drained.
The strategy is to buy as close to $535 as possible. As long as the MKR/USD stays above this level, bulls will likely generate the momentum to rally to our targets of $750 and $928.
The process may take a month.
Daily Chart of Maker/US Dollar on Bitfinex
As of this writing, the Maker/US Dollar pair is trading at $565.90 on Bitfinex.
Summary of Strategy
Target: $750 first and then $928.
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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