2019 hasn’t been spectacular in the cryptosphere like the two previous years. 2017 was amazing, 2018 was terrible. Each was outstanding in its own way. So far 2019 has been uneventful for the most part. The year’s been dominated so far by little bullish runs in the main currencies (LTC, ADA, TRX, XRP, ETH, EOS, and of course, BTC) that seem to be synthetic. Adjustments to impulsive big buying orders.
We could group the cryptocurrencies in question into two classes. Those who arrive early to the party, and those who arrive late. The ones that get there late are the bigger ones (the ones with the largest market capitalization) which is natural. Capitalization has its advantages, but it makes inertia more relevant too.
Early arrivers don’t have the prestige or capitalization you find on the bigger boys. And that’s why they can move more quickly. You don’t need as much money to make a difference in the market, so artificial pumps create proportionally more significant trading volumes and fluctuations in price. And then, retailers follow. Sometimes, they’re self-fulfilling promises.
Let’s look at Tron’s Tronix or TRX, 11th coin in the world by market capitalization which is enormous if you take the market as a whole, but not so big when compared with Bitcoin or Ethereum, even XRP. It reached a peak on February 6th. But that was the peak. The token had been moving up since the previous December (which is what you should expect from early arrivers).
And that behavior is how you can tell an organic (thus authentic) bullish rally from an artificial one. TRX’s level on week six was the same it had when BTC was at $7.000,00 when the market’s value was way more substantial.
So in December TRX was pumped somehow artificially. The price went up for a couple of months, but there was still no indication that could confirm the trend as organic, authentic, which is to say sustainable. So the unavoidable happened. All the money that supported Tronix’s growth went away from it and into another asset. Litecoin, in this case. And then Litecoin was left behind in favor of ADA.
So Tron arrived at the party first, then it was Litecoin’s time, and Cardano’s ADA came then. But late arrivers arrive in the end, always. So it was Bitcoin’s turn. We’ve seen similar circles in the past, and we fully expect to keep seeing them in the future. Bitcoin will always arrive last. But it will make the most noise too.
As the previous week was finishing new signs of a Tron pump started to become visible. A few large traders are pushing TRX with the probable intention to have more money they can later use in BTC and ETH after having pumped selectively the coins that could get their home and dry in the quickest possible way. And they start with Tron, instead of going for BTC from the beginning, simply because it’s easier to move.
That’s all about sheer speculation. But fundamentals count as well, and it seems that something of the rise in value has something to do with the good news we will learn soon from Justin Sun’s (Tron’s founder and CEO) Twitter account regarding his project. Remember that critical news trump technical analysis and speculation every time.
Several analysts had a bullish run foreseen for Tron during May. May started a couple of days ago already, and there’s every reason to believe it will be a very bullish month for TRX. And we have some hard data to verify that forecast by looking at the historical RSI values, which is one of the best indicators when you’re seeking to correlate changes in cryptocurrency changes.
Relative Strength Index and price correlation.
There is a set of relevant critical events in Tron’s history of maximum and minimum prices. They relate directly with the bullish or bearish market sentiment. If you look at the TRX RSI indicator in a 1D chart, it becomes very apparent.
During February 4th, 2019 Tron was floating over its lower levels. It was a bearish trend straight out of a technical analysis textbook. But the trend wasn’t that strong (lack of confirming indicators) so no great price action was expected for the following month.
Then, during March, Tron was beneath its exponential moving averages of 20 and 50 days. It seemed that USD 0,028 was a firm resistance level.
By the same token (no pun intended) it’s not hard to see that buying pressure on an asset that prompts a price increase and the RSI to go above 70 (which is typically what analysts consider overbought). That’s how bullish sentiment is revealed in a timeline.
On the contrary, if the RSI is 30 or lower and the overall scenario is the reverse, then we’re dealing with bears.
Knowing and understanding the previous information enables us to compare the prescribed dates for the next significant change in price to happen, and average them. So taking into account the April 24th scenario together with a minimal RSI, here’s what we would have: the next bullish rally (could possibly be happening already) and it will bring TRX’s price up by as much as 54.25%.
That event would also be consistent with Elliott Wave theory (favorite of most Forex traders) as it would constitute a third wave. In that case, the boost could reach 73.12% as May ends. So this could be an excellent opportunity for the average retail investor. The idea would be to catch the upcoming wave right now and surf it until May ends. That would make for a handsome profit, primarily if you operate with a leveraged broker.
Tron’s behavior as April ended
We have flatness in exponential moving averages in 20 and 50 days. We usually construe this as a deacceleration in momentum which is not a bad thing as long as it means that consolidation is becoming more robust. There was no break on the upside, so there is selling pressure that becomes more important around the $ 0.02466 level.
There is also resistance, and it’s sturdy. It’s at $ 0.02580. Support will probably remain at $ 0.022.
Ok, so now you have all the data, figures, jargon, etc. What’s the bottom line? Tron’s current trend is not strong. As things stand, it could break in either direction because there are no definitive signs that can support either thing happening.
The analysis gives preference to an upwards break so it wouldn’t surprise us. But crypto is as crypto does. It’s unwise to rule anything out because the market’s volatility and the weird behavior we’ve seen in trigger-happy retail investors acting as a crowd in the past, must remind us that anything can happen at all.
That being said, 73% in profit wouldn’t be out of the question. It would even be expected. And that would also empower Bitcoin to move forward.
Tron: The fundamentals
But, as stated before, when relevant news hit the crypto verse, you can do all the technical analysis you want, the day will be carried by the news’ effect. And Tron keeps delivering news of all kinds (mostly good) all the time. Great PR is one of the project’s main strengths, and it shouldn’t be underestimated.
We start at the beginning. When it comes to Tron there’s no secret about Mr. Sun’s influence in the crypto verse as a whole, but in the market in particular as well. The man is the driving force behind Tron’s creativity, innovation and momentum. But he also knows how to masterfully use a Twitter account to create waves in the crypto world and its market. Never underestimate the importance of hype. Mainly when it’s based on true facts.
Rumors have been floating around about a possible strategic partnership between Tron and ChainLink. That would increase the TRX price. It would enable users to enjoy the advantages of smart contracts based on real-time signals. It would make the network even more useful for all kinds of users and customers.
Mr. Sun recently gave two Tesla cars away, in a masterful PR move. He was initially going to give only one away, but he opted to go for two after the process was called into question by the first car’s winner and many community members. That left the project’s founder looking like a generous and Salomonic figure who cares more about the community’s cohesion than about money. You can’t bolster a reputation in that way with marketing alone.
The long-awaited Oddysey v3.5 upgrade has been online since February 28th. Thus transaction speeds are higher, while fees are lower, so the network is now even more attractive for developers who are looking for alternatives to Ethereum as a deploying platform. TronGrid 2.0 got an upgrade right after the main hard fork which also enhances the advantages for dApp developers.
The Tron community boasts 1,978,032 members as we write this if we go by counting wallets. Large population achieved in about 18 months.
Mr. Sun threw in some extra gasoline in the feud Vitalik Buterin (Ethereum’s founder and leader) already has towards him as he went forward to call his own project the “Ethereum killer” as Tron is now the world’s premier platform for decentralized applications. Mr. Sun is not the first person to use those two words to refer to Tron. The term gets mentioned in crypto-related articles very often since Tron became independent from Ethereum as a blockchain. But having the project’s leader saying it out loud makes it “official” up to a certain point.
Then, there’s a new Odyssey upgrade on the works which could make things even bigger. When that update is announced, you can and should expect the price to be affected positively. The new upgrade (it’s suspected) would improve the smart contracts’ performance (which would be a nightmare for Ethereum because that’s the only niche it still dominates).
Then there’s the BitTorrent deal. It belongs to Tron now. It will merge into Tron’s network soon, though we still don’t know any date. Tron issued a new Tron-based cryptocurrency to support the new blockchain-based torrent network called BTT. And it’s already six times higher in price than it was at the time of the ICO.
BitTorrent’s hype has pushed Tron’s price for sure. But this is a rare case in which all the hype maybe be falling short of reality. BitTorrent is the world’s largest decentralized network in the world with hundreds of millions of users scattered all over the planet. If only the tiniest fraction of those old users become interested in Tron because of the changes they will probably notice in their favorite file sharing network, we could be seeing millions of new users coming to Tron.
May is here. And it brings every reason to expect good things from Tron.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.