Tron retraces to a level that the bulls must defend
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- TRX bulls have been steadily buying the token throughout July, showing another rally was possible.
- Bitcoin’s weakness could throw a wrench in its plans.
Tron [TRX] has a bullish bias on the higher timeframe charts. Even though it has faced large losses over the past three days, it was trading inside a strong demand zone yet again. Nevertheless, buyers must be prepared for a bearish scenario.
Realistic or not, here’s TRX’s market cap in BTC’s terms
Bitcoin [BTC] continued to slide lower, and this would likely discourage TRX buyers and fuel bearish sentiment across the market. Therefore, despite the good risk-to-reward that TRX appeared to present, proper risk management would be key for bullish traders.
TRON is back at a support zone that initiated the previous rallyThe daily chart showed that Tron was trading in an interesting place. Its price action showed a bearish structure after a higher low at $0.08 was breached on 30 July. RSI also fell below the neutral 50 level. Yet the bulls still have hope.
The $0.078 zone was highlighted in cyan to show that it has been a bullish breaker block since early June. The support zone saw TRX begin a rally in mid-July that reached $0.093. A retest of the same region could provide another such positive result. The OBV has climbed higher over the past month, supporting the idea of accumulation.
To the north, the $0.086 has been a resistance level since the early June high was set. 22 July’s TRX price surge was unable to close the 1-day trading session above this level. Moreover, the $0.09-$0.093 area level was a significant resistance from December 2021 and May 2022.
Therefore, it is a region that was vital for long-term bulls to convert to support, as well as a place where swing traders can look to take profits.
The slump in Open Interest showed evaporating bullishnessOn 23 July the Open Interest jumped considerably higher as TRX prices reached the $0.084 mark. At the time, it was a show of bullish sentiment, but the buyers faded into the background after that.
How much are 1,10,100 TRX worth today?
TRX was unable to beat the resistance at $0.086, and the OI began to decline thereafter.
As things stand, the inference from the OI chart was sustained bearish sentiment over the past week. If the OI began to pick up once more from the support zone, it could indicate another toward $0.086 was coming.