The EOS/US Dollar pair ignited its bull run on December 13, 2017 when it took out resistance of $5.50. With a firm base below $5, the pair was able to climb to as high as $18.67 on January 13, 2018. In one month, EOS/USD grew by almost 240%. Those who bought the breakout and those who followed the trend started to take profits.
As sellers dominated the market, EOS/USD plunged to $7.50 on January 17. Even though bottom pickers bought the dip, the rally that they inspired could only lift the market to $15.75 on January 20.
With a lower high in place, market participants began to either lock in their gains or cut their losses. The increased selling activity pushed the market in a downward spiral until it bottomed out at $3.8723 on March 18. Fortunately for buyers at this level, the pair has been rallying since. It even launched another bull run.
Technical analysis show that EOS/US Dollar has taken out resistance of $9.50 on April 20 and triggered the inverse head and shoulders pattern on the daily chart to signal the end of the correction. The breakout was so strong that the pair surged to $11.70 on the same day. However, the market is in extreme overbought territory. It must consolidate for some time before it can resume its ascent. This is where you can come in.
The strategy is to wait for the dip and buy as close to $9.50 as possible. Sellers will most likely dominate the market in the next few days to help shred overbought readings. As long as $9.50 holds, our target is $13.50.
The process may take a month.
Daily Chart of EOS/USD on Bitfinex
As of this writing, the EOS/US Dollar pair is trading at $11.115 on Bitfinex.
Summary of Strategy
Buy: Buy on dips as close to $9.50 as possible.
Target: $13.50
Stop: $8.88
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.
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