Hi everyone,
As promised yesterday I am going to show you possible buy-in zones for Chainlink and Tezos. These two Altcoins have been going up very nicely recently (Chainlink is already for a longer while very strong) and when you go up so fast and so hard, it is also very likely you will fall down hard and fast. This is happening with Tezos and kind of with Chainlink as well, but hey, this will give you another chance of joining the party if you missed out on it the last time !
A lot of people get emotional when they miss out on big gains and FOMO (fear of missing out) in at high prices. They will likely sell when it dumps hard and lose money. There are also people that regret missing on big gains, but when prices dump hard, stay on the sidelines and miss out once again ! They do not really know where to buy-in and will arrive at the party when the train has already left. Luckily you get several chances with buying in, because what comes up, often comes down as well.
Chainlink (LINK)
Chainlink has been showing a lot of promise during 2019 by growing a lot, while most of the Altcoins were going down. It was not correlated to BTC which is a big deal. In 2020 so far we see a decent run up, but the last couple of days have been rough. Since it had been running up hard and fast, it will most likely come down hard and fast as well, which is the case. Chainlink is one of the big crypto projects out there that aims to connect smart contracts of different blockchains with each other. It uses “oracles” to find and verify real-world data and bring this on-chain. This will then be integrated in smart contracts. Google became a partner of Chainlink which is great news of course.
Here I will show you a daily chart of Chainlink with the indicator OBV (On balance Volume) :
You can see in this chart the Fibonacci retracement levels and for now it has dropped exactly to the 0,5 level at around 3,26$ before moving back up a little (demand is coming in here already, which is a good sign). The OBV on the bottom is showing confluence with the price, so this means that the price drop and the on balance volume agree with each other. Traders are taking profits on LINK and price is moving down. The volume bars show sell pressure as well for LINK. Traders however will come back to LINK again and most likely you will see the following levels being bought : 3,26$ like we have seen today, 2,88$ level which is around the 0,618 fib level and 2,33/2,34$ level which is the 0,786 fib level. The 2,33$ seems low to me for now and I am not sure we will get that low. It is always good to sprinkle your buy orders at different levels and preferably you place them a little bit higher than the fib levels. Price might never reach the exact fib levels if a lot of people are watching these. I have drawn a channel in the OBV indicator. You want to follow this channel and OBV should not break this to the downside, otherwise you will see a harder fall for Chainlink. I do not think this will happen, because a lot of people are interested in this coin. A break to the upside out of the channel will show strength and should lead to more upside after that.
This is another chart (daily) and shows the RSI at the bottom and the 100-day Moving Average. The RSI clearly shows a heavy downfall and this will not continue for a long time. It is rather erect and it will slow down. I have drawn a channel and likely LINK’s RSI will slow down and stays in this channel. A break to the upside will be a good sign, but otherwise I suspect we will move towards the oversold territory.
The 100-day Moving Average is the orange line in the price chart. It is moving upwards slowly and if you look on the left you can see it being used as support and resistance. There is a possibility we will see price go towards this MA and bounce off of it. Price level right now is around 2,60$, but the moving average will move around so price level can change every day.
Tezos (XTZ)
Tezos was gaining a lot of attention with its price moving up rapidly and strongly. However these last days have been rough for XTZ and I will try to find out which levels might be of interest of buying in.
Tezos is a company that want to solve key problems in blockchain adoption, like smart contract safety, open participation and long-term upgradability. They will compete to players like Ethereum, NEO, EOS, etc. Tezos offers staking (delegated proof-of-stake) and this you can do with your Ledger if you want. Coinbase offers staking as well for Tezos, but they take a high commission, so you would be better off doing it yourself with your ledger if you have one of course.
Personally I am not yet invested in Tezos and I missed the boat, but I am looking at entering once it will pull back enough. Here is a daily chart of Tezos :
The daily chart has the RSI at the bottom and shows a clear downtrend. Most likely it will stay inside this channel and it seems likely it will re-test the upper green line. If it can break it great, but if not we will see more downside on Tezos. Tezos was showing already bearish divergence and now it is playing out. Price levels to watch are linked with Fibonacci and are 2,57/2,58$ (it is very close already), around 2,25$ for the 0,618 retracement and around 1,80$ for a retracement of 0,786. Tezos climbed very fast and thus falls fast as well. It seems likely to me that we will see a 2,25$ for Tezos. On the other hand 1,80$ is still far off and I am not sure it will reach that.
You always have to look at BTC as well since these last days we have seen a general sell off and Alts fall harder than BTC. BTC is at the time of writing around 9000$ and I can see it falling towards 8500/8600$ to fill the CME gap and maybe even further towards 8000$. This would be around 10% for BTC as a drop from 9000$. Since Alts fall harder it seems possible for Tezos to reach 2,25$. XTZ is right now around 2,62$ and a fall towards 1,80$ would be around a 30% drop. For now it seems too much, but if BTC wants to move under 8000$, then it is well possible to reach 1,80$.
Another chart here with the OBV indicator at the bottom. I have drawn a blue line to show you that OBV is actually staying strong for now, but hovers around the edge. This shows that for now people are being shaken out of Tezos and smart money is starting to accumulate. The volume here does not completely agree with the price. We might see some relieve on Tezos soon, but if this line breaks we will see some more downfall and the 2,25$ will be our next level to watch.
Watching the market in general we see a clear downtrend for Bitcoin and the Altcoins. Chainlink and Tezos are falling down like the rest of them, which is no surprise. Everything is on edge right now (stock markets, oil, crypto, etc.), but I believe we will see a form of relieve soon. The question is if crypto is correlated with the stock market and the coronavirus or not ? Some people will say yes, other people will say no. Personally I do not believe there is correlation and we are made out to believe it is so by whales, institutions, etc. Altcoins have been moving up a lot lately (and fast as well) and this means it will come down faster as well. Bitcoin was ready as well for a correction/consolidation and this helps create the narrative with the coronavirus that we all move down because off it. The coronavirus however has been out for a while now and all of a sudden we decide to drop the stock markets a lot and crypto as well ? I really wonder….
This is not financial advise and I am not a financial adviser. Do your own research and make your own decisions.
