The Monero/Dollar (XMR/USD) pair ignited its uptrend on November 22, 2017 when it breached resistance of $150. The breakout attracted momentum traders, and that pushed the price to as high as $477 on December 20. In about a month, the market grew by over 218%. However, the pair was in extreme overbought territory at this level. Breakout traders used this opportunity to take profits.
Faced with heavy selling pressure, the pair went as low as $151.26 on December 22. As market participants sensed that a higher low was in place, they bought positions, which sparked a rally that saw the the market reach $449.18 on January 15. Unfortunately, $449.18 was a higher low, and bears responded by sending the pair to as low as $150 on February 6. At this point, XMR/USD was back at its breakout price level. It quickly rallied since there was no more sellers.
Technical analysis shows that the Monero/Dollar pair is creating a bullish higher low setup at $270. Bulls appear to respect this support level as the market has been consolidating around $270 for about a week now. This could be the base that launches XMR/USD to the resistance level of $415.
The strategy is to buy as close to $270 as possible. Once bulls successfully claim this level, the pair will likely resume its march to our target of $415. The process may take a month.
Daily Chart of Monero/Dollar on Bitfinex
As of this writing, the Monero/Dollar pair is trading at $276.12 on Bitfinex.
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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