The Florincoin/Bitcoin pair (FLO/BTC) launched its bull run on April 6, 2017 when it took out resistance of 0.00001. This triggered the large cup and handle pattern on the daily chart. The breakout attracted so much momentum that the market went as high as 0.00006541 on May 13. In less than a month, FLO/BTC grew by an astronomical 554%.
At this price level, the market showed bearish signals. First, the market was in extreme overbought territory. In addition, it struggled to close above the 61.8% Fibonacci level. Those who saw these signals knew it was time to lock their gains.
The heavy selling drove the pair down to 0.00002232 on May 28, 2017. After seeing that the market respected the 38.2% Fibonacci level, bottom pickers entered the buying picture and ignited a rally to 0.00005645 on June 16. Sensing that a lower high was in place, participants dumped their positions to preserve their capital. As a result, FLO/BTC generated a series of lower highs and lower lows until it bottomed out at 0.00000505 on December 8.
The pair has been showing bullish signals since. This could be your opportunity to buy the breakout.
Technical analysis reveals that Florincoin/Bitcoin is positioning to take out resistance of 0.0000157. This would trigger the ascending triangle pattern on the daily chart. To complete the breakout, FLO/BTC needs to print at least 1 million units of Florincoin. Those who bought the bottom and the higher lows are likely to take profits at the resistance. The market needs buyers to absorb the selling pressure.
The strategy is to buy the breakout of 0.0000157 after the market generates the required volume. The breakout may attract a lot of momentum that can push the pair to our target of 0.000024.
The process may take a month.
Daily Chart of Florincoin/Bitcoin on Poloniex
As of this writing, the Florincoin/Bitcoin pair is trading at 0.00001386 on Poloniex.
Summary of Strategy
Buy: Buy the breakout at 0.0000157 after volume of 1 million Florincoin units is met.
Stop: 0.000014 after the breakout.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.