Trade Recommendation: SONM/Ethereum

The SONM/Ethereum pair (SNM/ETH) launched its first bull run on December 17, 2017 when it took out 0.0004 resistance. The breakout had a strong momentum that it pushed the price to as high as 0.00121111 on January 6, 2018. In less than a month, the market skyrocketed by over 200%. Breakout buyers exploited the chance to dump positions and lock their gains.

Faced with heavy selling pressure, the market broke below 0.0004 support on January 14. This is what usually happens to high flyers. They often crash as soon as they hit the top. As SNM/ETH nosedived, this could be your opportunity to pick the bottom.

Technical analysis show that SONM/Ethereum appears to be bottoming out at 0.0002 support. The market has always respected this support level as seen in the bounce that occurred on November 25, 2017. The pair has also touched 0.0002 support on March 9, and bulls rushed in to defend the support. Both price and volumed surged on that day.  

The strategy is to buy as close to 0.0002 support as possible. If bulls continue to defend this level, it will likely create a base before climbing to our target of 0.0004. The process may take a month.

Daily Chart of SONM/Ethereum on Binance

As of this writing, the SONM/Ethereum pair is trading at 0.00021386 on Binance.

Summary of Strategy

Buy: As close to 0.0002 as possible.

Target: 0.0004

Stop:  0.00018

 

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.