Crypto Charts Analysis #4 Monero (XMR/USD) 7th July 2017

nimda (35)in #trading • 7 years ago

***Disclaimer***

Please keep in mind : The risk of loss in trading can be substantial. I am not offering financial advice nor am I telling you how or what you should be trading. I will simply be applying charting techniques I have learnt over the years. If, of your own free will, you decide to trade never trade with money you cannot afford to lose and if you do trade, try to spread out your trades on multiple assets. A diverse portfolio is much better than only holding a single asset.

***End of Disclaimer***

Hi fellow Steemians, fellow investors, traders and crypto enthusiasts. Today while looking through the charts I came across the XMR/USD chart. As usual I set the time frame to 1 day and was instantly stuck by a chart pattern.

Monero (XMR/USD)

Monero has been making steady gains since July of 2016. Granted there have been some corrections along the way, and this is to be expected, but all in all it's been up up and away. What has struck me now though is the ascending triangle pattern which has started forming on the 17th March 2017.

So what can we see in the chart?

When looking at this chart the first thing I see is a double top (one market by the green arrow and the previous top marked with a vertical pink line) and a rising trend line (marked with a white rising trend line).

These two lines together form the ascending triangle where as time goes by we can see higher lows which are marked with red arrows (there are also two more lower lows before the first arrow).

There has been tremendous selling power each time the top of the triangle was breached with each downward move to the trend line only taking a couple of days on average however not one candlestick has closed below the rising edge of the triangle pattern.

So what could we expect with XMR/USD?

An ascending triangle is a continuation pattern so we would expect a break of the resistance level and a continuation of the upward trend.

Targets

With this chart I would look at two possible targets, with one being more conservative than the other.

Target 1 will be the height of the confirmed pattern. This would be from the resistance line (horizontal light blue line) to the point where the low hits the rising trend line, marked with a horizontal green line.

The calculation : 56.16 - 29.52 = 26.64

So now to calculate target 1 we just add this value to the resistance line.

Resistance @ 56.16 + 26.64 = 82.8

Target 2 will be taken from the first point that creates the rising trend (horizontal orange line) line to the same resistance line as in target 1.

The calculation : 56.16 - 20.56 = 35.6

So now to calculate target 2 we just add this value to the resistance line.

Resistance @ 56.16 + 35.6 = 91.76

Stop Loss

If I will not be interested in still holding if the price goes against me I would locate the previous low once there is confirmation that the price has broken out of the pattern.

This can only be seen once there is a break since we could easily see the price bounce about the support and resistance a couple of times before the breakout and each bounce will possibly create new highs and new lows.

Entry

A close above the resistance could be used as an indication that the price will be moving upward. Saying this though I would be cautions. Just ahead of the green arrow (marked on the chart above) we have already seen a close above the trend line. One could argue that it could easily plummet again to the rising trend line as it has done in the past. A counter argument to this would be that the price broke through the resistance level way too early in the pattern and needed more time for the bulls and bears to level each other out.

So as for an entry it is best to see how this pattern will play out the closer we get to the converging lines.

So fellow Steemians, investors, traders and crypto enthusiasts what is your take on where the price of XMR/USD is going? Do you agree or disagree with this analysis or do you have your take on what the chart is showing ?

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