Analysis

Tron presents a risky long play – Should TRX traders take it? 

Tron reclaimed the $0.076 – $0.078  support zone and could present a risky long opportunity. Should buyers indulge?

Published

1 year ago

on

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion

  • TRX reclaimed the previous support of $0.076 – $0.078. 
  • Open Interest rates improved, and buyers gained control. 

Tron [TRX] was an outlier last week (21-27 August) and outperformed Bitcoin [BTC]. While the king coin tucked 0.34% loss, TRX gained 2.64% on weekly performance, according to TradingView. 

Is your portfolio green? Check out the TRX Profit Calculator

 

The decoupling from BTC’s price action set TRX to reclaim a crucial and previous support zone of $0.076 – $0.078. The move could present a long opportunity, but there was a caveat. 

Can TRX push forward?

Source: TRX/USDT on TradingView

Since 22 August, the Relative Strength Index (RSI) has been above the 50-mark, showing buying pressure improved in the past few days.

Similarly, the Chaikin Money Flow (CMF) hasn’t gone below the zero mark since early August. It demonstrates strong capital inflows into TRX. 

The next critical resistance level was $0.080 and could be the next target if bulls stay on course. If so, further upswing could offer a long opportunity, targeting $0.080 with an entry at the support zone ($0.076 – $0.078). 

But the long opportunity is a risky play. Although TRX decoupled from BTC last week, there were signs of re-coupling, as shown by a positive correlation coefficient with BTC. So, a weak BTC could set TRX to crack the support zone and invalidate the long set-up. 

A candlestick session close below the support zone ($0.076 – $0.078) will invalidate the long idea.

Buyers had market control

Source: Coinalyze

According to Coinalyze, the Cumulative Volume Delta (CVD) had a positive slope since 18 August. It illustrated that buyers steadily gained market control from mid-August. 

How much are 1,10,100 TRXs worth today? 

Over the same period, the Open Interest (OI) rates improved. It surged from around $44 million (18 August) to over $53 million at the time of writing. The surge denotes improved demand for TRX in the derivatives segment – a bullish bias. 

Traders should track BTC price movement and TRX correlation to optimize trade set-ups and minimize losses. 

Take a Survey: Chance to Win $500 USDT