Trade Recommendation: Metal
Metal (MTL/BTC) looks interesting not because of its market structure, but because of how volume almost disappeared after the market breached key support of 0.00003 on June 18, 2018. When key support areas are taken out, markets usually experience a series of huge selloffs that drive the price down. In the case of Metal, the market continued to plummet even with extremely low volume.
This told us that buyers are nowhere to be found even if the MTL/BTC price is supposed to be a bargain. Without buyers, the market’s health failed as it bled one red candle after another. Under such conditions, a short-term bottom may be established once buyers return. If you look at the volume recently printed by Metal, you’ll see that bottom pickers and bargain hunters have arrived.
Technical analysis shows that MTL/BTC appears to be creating a short-term bottom. In addition to the recent volume upticks that show buying activity, Metal has managed to defend support of 0.0000615 despite selloffs. As a result, the market appears to have generated a double bottom structure on the 4-hour chart. This gives us the confidence to trade the bottom.
On top of that, the hourly chart looks bullish. We can see a golden cross on this short time frame as the 50 MA crossed above the 100 MA. On top of that, it looks like the 50 MA will also cross above the 200 MA soon. These crossovers on the shorter time frame tell us that the market is turning bullish. Don’t be surprised to see Metal spike in the next 48 hours.
The strategy is to buy as close to 0.0000615 support as possible. As long as bulls defend this level, Metal will likely generate the momentum to climb as high as 0.0000807. Take that out and the next target is 0.0001.
The process may take less than a month.
4-Hour Chart of Metal/Bitcoin on Binance
As of this writing, the Metal/Bitcoin pair is trading at 0.0000652 on Binance.
Summary of Strategy
Buy: As close to 0.0000615 as possible.
Targets: 0.0000807 and 0.0001.
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.