TRON (TRX/USD) closed 2018 with strength relative to the last couple of months. It is currently trading around $0.0208. At this price level, the market is up more than 90% from its 2018 low of $0.0111 on November 25.
This huge surge in less than one month is more than enough reason for many traders to be bullish on TRON. However, one must also consider that when the market bottomed out, it lost close to 90% of its value from the 2018 peak of $0.10041. Thus, it would also make sense to say that the recent bounce is nothing more than a relief rally.
That is why it is important to examine the market closely to see whether TRON has more upside potential. We did that for you and what we saw was promising. In this article, we reveal how TRON is showing bullish signs.
Structure Resembles Market Leader
In any asset class, whether it be equities or cryptocurrencies, there are some instances when a market leader emerges and then everyone else follows its direction. For example, Apple Inc. was down big yesterday, January 3. Notice how many tech stocks followed suit.
As for cryptocurrencies, the clear market leader right now is Ethereum (ETH/USD). It is currently trading around $160 to put the market up by over 95% from its 2018 low of $83. More importantly, Ethereum has taken out firm resistance of $145. This triggered the breakout from the cup and handle pattern.
ETH/USD daily chart
TRON appears to be following the same pattern. It established a bullish higher low of 0.018312 on December 28. With this setup, TRON looks to follow Ethereum’s footsteps as it creates a cup and handle pattern to take out resistance of 0.023.
TRX/USD printing the same cup and handle pattern
As they say, “a rising tide lifts all boats.” With Ethereum’s emergence as a clear market leader, it seems that TRON is closely following behind.
Bullish Continuation Pattern Emerges
One basic technical analysis concept is support becoming resistance when breached and vice-versa. From August to November 2018, TRON relied from $0.016 to keep the market afloat. Unfortunately, this level was taken out on November 19. Consequently, $0.016 acted as a resistance as the market dumped to its 2018 low of $0.0111.
TRON traded below $0.016 until December 20 when bulls drove prices above the resistance. The range breakout attracted momentum traders who helped push the market to as high as $0.0243 on December 24. As a result, we have a long bull flag in the making on the weekly chart.
Weekly chart of TRX/USD
This pattern suggests the continuation of the current bullish trend. The market may be in a period of consolidation but it will very likely resume its ascent once sellers run out of ammunition.
Shorter Time Frame Looks Bullish
Another reason why TRON looks bullish is because of the emerging setups in the 4-hour chart. Aside from the higher low of $0.018312, the three main moving averages are beautifully aligned. The 50 MA is above the 100 MA while the 100 MA is on top of the 200 MA. All of these moving averages are acting as support levels.
4H chart of TRXUSD
These three moving averages will help TRON trend higher. Think of them as a multi-layered escalator that can be instrumental in breaching resistance of $0.023.
TRON is up by over 90% from its 2018 bottom and it looks like the market wants to trend higher. It appears to be following the footsteps of Ethereum as it generates bullish setups in the longer and shorter time frames. With these signals, TRON is likely to have a strong first quarter in 2019.
Featured image courtesy of Shutterstock.