Jun 05

TRON Creating a bullish Triangle. Time for a Long Entry?

Tron is moving in a bullish trend after the dramatic selloff experienced by the market in the so-called Black Thursday. TRXUSD made a relatively smooth climb to 0.01668. After that, it created a sideways consolidation that resembled a triangle continuation pattern. On May 10, it suffered a sharp correction that lowered its value to 0.013, where it found buyers that created a bounce and a further sideways action that resembled a large and complex triangular structure. On May 28, buyers managed to move the price beyond the limits of that triangular formation and to fresh highs, where TRON is currently running.


On the 120 min chart, we can see that it is drawing a shorter triangle showing higher lows but basically moving to the same high.

On the 120 min chart, we can see that it is drawing a shorter triangle showing higher lows but basically moving to the same high. We also observe that the price moves in above the +1 sigma line of its Bollinger bands, and the bands head up. Also, the price is supported by its 50-period simple moving average (SMA), and the Stochastic oscillator shows an upward turn.

A bullish setup can be made with an entry above 0.017322, a profit target at 0.018454, the top made before March’s selloff, and an invalidation level below the 0.01668 line, which is a strong support level. To be covered for potential spikes to the downside, we could set below 0.01622. That way, this setup shows a reduced Reward/risk ratio of 1, but the chanced of success increases. A possible strategy to improve this ratio is to cover only 50% of the positions once the price reaches the target, and trail the rest of the position to let the market tell the right spot for the closing of the trade.

Main Figures:

Buy stop: 0.017322

Profit target: 0.018454

Invalidation Level: 0.01622

Reward/Risk: 1.08

Dollar risk: $1.102 for every 1,000 coins purchased.

Following a position sizing strategy with a 1 percent risk, we should buy 9,000 coins for every 1,000 USD in the balance of the trading account.