Trade Recommendation: Tezos
Tezos (XTZ/USD) is a market that’s in a strong uptrend. We have this view because the cryptocurrency took out resistance of $1.04 on April 14, 2019. This triggered the breakout from a large rounding bottom pattern on the daily chart. The breakout marked the technical reversal and the beginning of the market’s uptrend.
With Tezos in full control of the bulls, it rallied to as high as $1.8652. From that point, the cryptocurrency has corrected. This gives us a chance to buy the market at a steep discount.
Technical analysis shows that XTZ/USD is headed to support of $1.04. We have this view because bears have managed to control our current range midpoint of $1.44. Below that level, our range low of $1.04 becomes the logical bottom-picking target.
We believe this level will hold because, by the time Tezos drops to $1.04, the market will likely be in oversold territory. As sellers lose interest to dump positions, we expect buyers to return because Tezos has an attractive risk to reward ratio at $1.04. In addition, the 100-day moving average is crawling close to that level. It will act as an additional support level to keep prices from dropping lower.
The strategy is to buy on dips as close to $1.04 as possible. As long as bulls defend this level, they will likely gather the momentum to hit our targets $1.44 and $1.84.
The process may take a month.
Daily Chart of Tezos/US Dollar on Bitfinex
Summary of Strategy
Buy: As close to $1.04 as possible.
Targets: $1.44 and $1.84
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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