Justin Sun is at it again — announcing something — and the market for TRON (TRX) is responding with major trading volume. Here we consider whether or not we should be wary of a ‘sell the news’ event.
Starting with the daily chart TRX/BTC, we see that the last two days especially have seen intense TRON trading volume. TRON had already been uptrend after finding the bottom of a very long downtrend (discussed here) in September.
Price on this trading pair has run into a previous support (now resistance) area from the summer, and it seems like the volume is news-related rather than resulting from natural trading momentum: The volume trend had been declining with price highs, a sign of flagging buy momentum.
Another feature of the chart that implies news-driven trading is the histogram indicator, which is obviously very un-smooth and without much natural flow. This is noise that could be reduced on a higher timeframe chart.
So, if we move to the 3-day chart, we see that TRX has been stopped exactly at the 55 EMA. If this 3-day candle (which closes today) closes with this much selling pressure, we could see a period of consolidation between the 55 and 21 EMAs.
The RSI, however, has been holding its uptrend very neatly. It would be worth watching this indicator to look for a break or hold in the trend.
Moving to the 2-day TRX/USD chart, we see that TRON is likewise here churning within a previous support — now resistance — zone, this time from the entire January-July market, at roughly $0.022. The histogram here is looking worrisome, beginning a sharp arch down on this bar — but there is still more than a day left before this candle closes.
The stochastic RSI here has been dogged in its bullish profile, and has formed an arching trendline that we may use to forecast a retracement.
All in all, TRON may well blast through the current resistance that is visible on both charts. But we are seeing some signs of fatigue on the indicators, as well as strong resistance. It would be safer here to let TRON prove its ability to breach those resistances on strength. It’s up to you, Justin.
The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.
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