Nick Chong · 1 day ago · 2 min read
Tron › Binance › Technical Analysis
Binance Coin and Chainlink at pivotal trading points while TRON remains bearish
Disclaimer: This article contains technical analysis, which is a methodology for forecasting the direction of prices through the study of past market data, primarily price and volume. The content presented in this article is the opinion of the author. None of the information you read on CryptoSlate should be taken as investment advice. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own diligence and consult with a financial advisor before making any investment decisions.
The recent market upswing took many investors into the bullish side once again. Even though the surge was seen across the entire industry, most altcoins lost the value they gained yesterday. This technical analysis will evaluate whether Binance Coin, TRON, or Chainlink have a chance to continue rising.
Binance was in the spotlight after its CEO Changpeng Zhao stated that the dedicated U.S. division of the cryptocurrency exchange will go live by November. He also recently revealed that the Binance is planning to launch Venus, an open blockchain project focused on developing localized stablecoins around the world to compete with Facebook’s Libra.
After gaining approximately 4.50 percent, Binance Coin lost almost all that value yesterday. As a result, a bearish engulfing pattern is forming on the 1-day chart. This is a technical chart pattern that signals a downward impulse.
At the moment, BNB seems to be held by support provided at the 150-day moving average. If the bearish engulfing pattern is validated, a break below the moving average is expected. Falling below the 150-day moving average could take Binance Coin to test the support given by the 200-day moving average, currently at $24.
It is worth noting that since mid-July BNB mostly traded between the 150-day moving average and the 100-day moving average. Thus, a candlestick close or open below the recent low of $26.75 could be used as confirmation that the 150-day moving average will break. However, if the 150-day moving average continues containing the price of BNB, then a rebound to the 100-day moving average seems more likely.
Despite the relentless marketing from CEO Justin Sun and his efforts to take TRX back into the top 10 by market cap the price of this cryptocurrency continues declining. It seems like investors have not been able to forget the claims made by different Chinese media outlets after Sun abruptly canceled his lunch with Warren Buffet. As a matter of fact, TRON plummeted nearly 47 percent since then and has been unable to recover from these losses.
Based on the 3-day chart, the buy signal given by the TD sequential indicator on July 24 was invalidated as the selling pressure behind this cryptocurrency increased. Now, a new bullish signal is given by this technical index in the form of a red nine, predicting a three-to-twelve days upswing or the beginning of a new upward countdown. Due to the low volume and the sentiment behind TRX, it will be wiser to wait for a green two candlestick to trade above a preceding green one candlestick, which will serve as confirmation of the bullish signal.
Conversely, the buy signal given by the TD sequential indicator will be invalidated if a red two candlestick trades below a preceding red one candlestick.
By measuring the Fibonacci retracement indicator from the low of $0.0111 on Nov. 25, 2018, to the high of $0.0408 on June 2, it appears that TRON is currently trading around the 78.6 percent Fibonacci retracement zone. As a result, TRON’s trend can be considered bearish due to the slope of the correction that began after TRX peaked at $0.0408.
If TRON is going to rebound per the TD sequential indicator, the 65 to 61.8 percent Fibonacci retracement zone could act as strong resistance. However, a break below the 78.6 percent Fibonacci retracement area could take this cryptocurrency down to around $0.0111.
June was a great month for Chainlink. During this time, Google announced that it was integrating LINK into its cloud-based services and Coinbase Pro as well as Coinbase listed it for trading. The result was a nearly 340 percent upswing in a matter of sixteen days that took this cryptocurrency from $1.11 to an all-time high of $4.80 on June 29.
Since then, Chainlink corrected 60 percent and recently entered a consolidation phase. From mid-July until now, this cryptocurrency is trading between $2.09 and $2.70. Consequently, the Bollinger bands on the 1-day chart appear to be squeezing. Squeezes are usually followed by periods of high volatility. The longer the squeeze the higher the probability of a strong breakout. Thus, the range between $2.09 and $2.70 seems like a reasonable no-trade zone.
Although Chainlink is in a no-trade zone, a symmetrical triangle seems to be developing on the 12-hour chart. This technical formation represents a period of consolidation before the price is forced to break out in a negative or positive trend. A move below the lower trendline marks the start of a new bearish trend. Meanwhile, a move above the upper trendline indicates the start of a new bullish trend. By measuring the distance between the initial high and low, the symmetrical triangle predicts a 28 percent target on both directions.
Based on the no-trade zone seen on the 1-day chart, the support and resistance levels could be used to confirm the direction in which the symmetrical triangle will resolve. Therefore, a spike in selling pressure that takes LINK below $2.09 could signal that this cryptocurrency will decline further to reach $1.74. On the other hand, an increase in buying pressure that takes Chainlink above $2.70 could allow it to surge to $3.15.
The entire cryptocurrency market entered a major corrective phase that has taken many coins to make lower lows. As Bitcoin continues signaling a move back above $11,000, altcoins appear to have more legs to go down.
At the moment, Binance Coin is sitting at a pivotal point where it could continue trading between the 100 and 150-day moving average or drop to a new low. Along the same lines, Chainlink could soon move 28 percent in any direction if the symmetrical triangle seen on the 12-hour chart is validated. Finally, TRON remains bearish despite Justin Sun’s attempts to bring it back into the top 10.