Trade Recommendation: OmiseGo (OMG)

OmiseGo

OmiseGo (OMG/USD) is a market that’s still trapped in range accumulation. On June 26, 2019, the cryptocurrency had a chance to take out resistance of $3.00 and launch its own bull run. Unfortunately, bears had the upper hand. They swiftly rejected the attempt to go above $3.00. With no bullish fight back, the market tumbled as participants scurried to take profits or cut their losses.

As a result, OmiseGo dropped to as low as $1.3002 on July 16th. That’s a nosedive of close to 60% from the 2019 high of $3.2357. Nevertheless, the market is showing signs of bearish exhaustion. We’ll take this chance to trade the bounce.

Technical analysis shows that OMG/USD is respecting support of $1.50. We have this view because even though the market dropped below this level on July 16th, bulls quickly responded and lifted the cryptocurrency above the support on July 20th. Thus, the move below $1.50 can be interpreted as a bear trap.

Also, volume has been on a significant decline ever since the market posted a 2019 high on June 26th. This indicates that sellers are losing interest in dumping the coin at current levels. This selling relief might offer OmiseGo the opening for a bounce.

The strategy is to buy as close to $1.50 as possible. As long as OMG/USD trades above this level, it will likely rally to our initial target of $2.251. Take that out and $3.00 is next.

The process may take less than a month.

Daily Chart of OmiseGo/US Dollar on Bitfinex

OmiseGo crypto chart
As of this writing, the OmiseGo/US Dollar pair is trading at $1.566 on Bitfinex.

Summary of Strategy

Buy: As close to $1.50 as possible.
Targets: $2.251 and $3.00.
Stop: $1.44

 

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.