Tron (TRX) has been getting support from the £0.051-level for more than a month while trying to break the £0.059-level. A breakout from the bullish pattern recently made it ripe for an upside.
Consequently, TRX was on the ascent to target the £0.059–£0.060 range for a retest. If the bulls are unable to manage the trend of dropping volume, a potential reversal could be imminent.
A spike above the 20/50 EMA increased the prospect of a sustained near-term recovery. At the time of writing, the altcoin was trading at £0.059, up 1.8% over the last 24 hours.
TRX rose significantly after a rebound from the £0.052-level. On the 4-hour chart, the recovery from this long-term support served as the basis for a bullish pennant.
The morning star candlesticks that facilitated the breakout from the bullish pattern were spurred by the 200 EMA, which also supported the short-term slide of the pennant.
The £0.059-£0.060 range could be tested by a sustained bull run with the 20 EMA still pointing north. The sellers have demonstrated a tendency to recover in the aforementioned range over the past two months. Investors and traders should therefore keep an eye out for rebounding signals.
Should this happen, retracements could be cushioned by the trendline support close to the 20 EMA at the £0.057-level.
The RSI, which indicates a definite bullish edge, surged above the 61-level. Before entering a short position, a potential reversal from the overbought area should not be ignored.
Additionally, the breakout rally’s lower troughs on the VO reinforced a bearish divergence with price. This underlined the possibility of a swift reversal.
Furthermore, the CMF reported lower bottoms and diverged bearishly from the price. If the CMF closes below zero, that would be another indication of the easing of the buying edge.
At press time, the bullish pennant breakout was headed to the two-month resistance in the £0.059-£0.060 range. With bearish divergences in the VO and CMF, the asset could meet a temporary setback before recovering to resume its buying binge. The same targets would apply.