Trade Recommendation: POA Network
POA Network (POA/BTC) breached key monthly support of 0.00000942 on November 20, 2018. At that point, the market appeared ready to print a fresh yearly low. However, bulls rejected lower prices as they rallied to close the day at 0.00000929. While the daily close was still below the monthly support, the daily chart generated a hammer candle. This encouraged more bargain hunters and bottom pickers to enter the market.
With the increased buying activity, POA/BTC rallied to as high as 0.00001216 on November 28. At that price level, participants who had a short-term trading horizon took the opportunity to lock in gains. As a result, the market retreated. Nevertheless, this pullback can be a good chance to buy the monthly support.
Technical analysis shows that POA/BTC appears to be range trading between 0.00000942 and 0.000016. The range has been further solidified by recent price action. The breach of 0.00000942 looks like a good old-fashioned shakeout. POA Network quickly recovered the support and now appears to be retesting it. So far, it appears that the support will hold.
The strategy is to set bids lower than the monthly support. Buy as close to 0.00000895 as possible. With this strategy, we avoid stop hunts or market maker liquidations.
As long as the market does not significantly deviate from 0.00000942, POA/BTC will likely be fine. More importantly, POA/BTC would have formed a triple bottom pattern. This will probably ignite a rally to the top end of the range of 0.000016.
The process may take more than a month.
Daily Chart of POA Network/Bitcoin on Binance
As of this writing, the POA Network/Bitcoin pair is trading at 0.00000948 on Binance.
Summary of Strategy
Buy: As close to 0.00000895 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.
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