Trade Recommendation: MIOTA
MIOTA (IOT/USD) is a market that’s trying to carve a bottom and start a new cycle. This view comes after December 7, 2018 when MIOTA dropped to lows of $0.2051. At that point, it was interesting to see whether there would be buyer interest at that level. After all, $0.20 was the area where MIOTA bottomed out in July 2017. We were curious to see whether the market will hold this level again.
Fortunately, bulls were able to defend the support. This triggered a rally to as high as $0.4081 on January 2, 2019. Although the market has been correcting since, this gives us a chance to buy MIOTA at a durable support.
Technical analysis shows that IOT/USD is en route to support of $0.206. This view comes after it breached below the range midpoint of 0.3039 on January 23. It then retested it as resistance on January 24. This price action tells us that selling pressure is still greater than demand. Thus, MIOTA is likely to revisit recent lows.
In addition, a drop to $0.206 will likely put the market in extreme oversold territory. This increases the chances of MIOTA holding the support. Should the support hold as expected, the market would have created a double bottom structure. That development will likely inspire a rally.
The strategy is to buy as close to $0.206. As long as IOT/USD stays above this level, it will likely rally to our initial target of $0.3039. Take that out and the next target is $0.4035.
The process may take less than a month.
12-Hour Chart of MIOTA/US Dollar on Bitfinex
As of this writing, the MIOTA/US Dollar pair is trading at $0.2552 on Bitfinex.
Summary of Strategy
Buy: As close to $0.206 as possible.
Targets: $0.3039 and 0.4035.
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.