Trade Recommendation: Salt
The Salt/Bitcoin pair (SALT/BTC) went below accumulation support of 0.000064 on September 11, 2018. The move forced many of those who bought at the support to cut their losses. Unfortunately for those who did, the market bounced and recovered 0.000064.
The false breach of the support or the bear trap enticed more bottom fishers and bargain hunters. This generated a strong rally that took out resistance of 0.0001 and enabled the pair to climb to as high as 0.0001277 on October 5.
At that price level, SALT/BTC was in extreme overbought territory in the 4-hour chart. The overheated RSI was a signal to participants to take profits. As heavy selling commenced, the pair went below 0.0001. The dip, however, allowed bulls to regroup and stage another rally. This bullish sequence of events is why we’re buying the market.
Technical analysis shows that SALT/BTC has once again taken out resistance of 0.0001. This triggered the breakout from the double bottom pattern on the 4H chart. The breakout looks valid, too. When SALT/BTC broke out on October 20, it printed volume that’s over 480% of its daily average. While the market rallied to as high as 0.0001374 on the same day, it has been retracing since.
The strategy is to buy the pullback as close to 0.0001 as possible. If bulls successfully flip this resistance into support, they will likely ignite a massive rally to our targets of 0.00016 and 0.0002.
The process may take more than a month.
4-Hour Chart of Salt/Bitcoin on Binance
As of this writing, the Salt/Bitcoin pair is trading at 0.0001064 on Binance.
Summary of Strategy
Buy: As close to 0.0001 as possible.
Target: 0.00016 first and then 0.0002.
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.