Our Verge/Ethereum (XVG/ETH) trade recommendation published on February 26, 2018 was able to hit the target even though the stop loss was triggered briefly. The best way deal with bear traps or with false breaks is to cut positions once the stop loss is hit with the intention of buying back after bulls reclaim the support. This way, you minimize losses while giving yourself a chance to ride the rally.
Those who bought at 0.00006 support grew their investments by as much as 233% in two months. The pair went as high as 0.00022907 on April 10.
At this price level, we expected the market to encounter heavy resistance. After all, 0.0002 used to be a key support level. Our expectation was met on April 17 when the market went as high as 0.00022681 only to close at 0.00013. The price action confirmed the resistance. This ignited a selling frenzy as those who bought the resistance rushed to cut their losses.
While the market looks extremely bearish, it has opened an opportunity to once again pick the bottom.
Technical analysis show that XVG/ETH still respects support of 0.00005. This view comes after the market dropped to 0.00004839 on June 24 but bulls defended the support. So far, the pair has managed to stay above the support and that is encouraging.
In addition, the MACD is flashing a bullish cross. Plus, the 4-day, 8-day, and 21-day moving averages are trending up.
The strategy is to buy as close to 0.00005 support as possible. If bulls continue to preserve this level, the pair will most likely bounce to our initial target of 0.0001. The process may take a month.
Daily Chart of Verge/Ethereum on Binance
As of this writing, the Verge/Ethereum pair is trading at 0.00005526 on Binance.
Summary of Strategy
Buy: As close to 0.00005 as possible.
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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