Tron: What TRX bulls must be wary of before placing calls

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

In extending its squeeze within the $0.063-$0.0702 range for over two months now, Tron [TRX] could not escape its low volatility phase. While hovering near its daily 20/50/200 EMA, the altcoin could look to break into high volatility.

The 200 EMA (green) has been restraining the bull runs for over six weeks. An inability to maintain the $0.064 baseline could put TRX on a bearish track.

At press time, TRX was trading at $0.06516.

TRX Daily Chart

Since swooping to its yearly low on 5 June, the 200 EMA has kept the buying pressure under a leash. The rectangle bottom structure came to fruition after a momentous uptick in buying edge.

While the bulls forced a bullish crossover on the 20 EMA (red) and the 50 EMA (cyan) after nearly two months, TRX revealed the build-up of its underlying buying edge. However, the $.0702-mark spurred the bearish recent pullback below the EMAs.

A sustained decline beyond the immediate support could open doorways for a retest of the Point of Control (POC) in the $0.061-zone.

To prevent further losses, TRX bulls must propel a much-needed hike in trading volumes. The break above the $0.068-level could serve as a convincing trigger for a near-term bearish invalidation.

Rationale

The Relative Strength Index (RSI) failed to maintain its position above the midline and depicted a strong selling edge.

The MACD lines looked south while plunging below zero. A sustained trajectory in this direction could reaffirm the bearish bias. However, the ADX continued to project a considerably weak directional trend for the altcoin.

Conclusion

Given the bearish crossover on the 20/50 EMAs alongside the weak readings on its indicators, TRX bears could eye to capitalize on the broader sentiment and provoke a decline. Any close above the near-term EMAs could invalidate these bearish inclinations. The targets would remain the same as above.

Finally, investors/traders should consider Bitcoin’s movement and its impact on broader market perception to make a profitable move.