The Neoscoin/Bitcoin (NEOS/BTC) pair started its bull run on December 25, 2017 when it took out resistance of 0.0006. With a solid base created of 0.0003 before the breach, the market skyrocketed to as high as 0.00136314 on December 29. In four days, the market grew by over 127%. The meteoric ascent tempted breakout players to take profits.
As those who bought the breakout locked in their gains, the market dropped to 0.00072312 on January 6, 2018. Bottom fishers bought the dip but the pair could only go as high as 0.00117825 on January 8. The lower high was a sign that bulls ran out of ammunition.
Those who saw the writing on the wall either took profits or cut their losses. The pair surrendered under the weight of increased selling pressure and resumed its fall. Nevertheless, it appears to have bottomed out three months after it showed bearish signs.
Technical analysis reveal that Neoscoin/Bitcoin appears to be carving a bottom at 0.0003 support. The pair went as low as 0.0002705 on March 29, but bulls stepped in to bring the market back up to 0.0003744 on April 5 with extremely high volume. This suggests that the move below the support was a false breakdown. In many cases, false breakdowns inspire the market to climb the top end of the range.
The strategy is to buy as close to 0.0003 as possible. If bulls hold on to the support, they will continue creating a base before moving to our target of 0.0006. The process may take less than three months.
Daily Chart of NEOS/BTC on Poloniex
As of this writing, the Neoscoin/Bitcoin pair is trading at 0.00033752 on Poloniex.
Summary of Strategy
Buy: As close to 0.0003 as possible.
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.