Blogs
IOTA (MIOTA) Price Technical Analysis: Retracement Levels
The price of a not so well-known cryptocurrency called IOTA has exploded over the last four days.
IOTA was priced at about $1.40 at the start of the rally on December 3, 2017, and traded up to a high of $5.59 on December 6th.
The price surge has come on the news of a major agreement being signed by the IOTA Foundation, a German non-profit firm that oversees the virtual currency, and Microsoft, Fujitsu, Samsung, and others for business-to-business data sharing.
IOTA has added more than $12 billion to its market value after the firm made the announcement, becoming the fourth-largest cryptocurrency asset by market capitalization, surpassing Ripple’s XRP.
What is unique about IOTA is its ‘Tangle’ system – a platform of interconnected nodes that both validate and create transactions.
This system is designed to allow users to create transactions simply by validating. This means that all transactions are secure, immutable and, most notably, allows for zero transaction fees.
Consequently, it’s ideal for the data industry, as micropayments for data among businesses cannot be suitably handled by legacy blockchain technology systems.
Chart #1: Bitcoin Daily
The strong upward price surge by IOTA can be clearly seen in the daily chart above (Chart #1).
Price moves of this sort that are mainly “news” driven are typically followed by a price retracement, usually a result of profit-taking and short-covering.
Also typical for this type of price move, is a second price surge, usually caused by an increase in demand by those traders/investors that where late getting the news, and missed the first move.
These traders will be looking for a good-sized price dip for a set-up to a favorable long entry point.
Chart #2: Bitcoin 30-Minute
The daily chart (Chart #1) shows a price retracement from the high.
The trading action of the retracement can be better analyzed on the 30-minute chart above on Chart #2.
Price action has broken-down through a support level at about $3.81, which is just above the 38% Fibonacci price retracement level of $3.69.
Price is now approaching 50% Fibonacci level.
The savvy trader will look for price to bounce off the 50% Fibonacci level, with strong volume, and enter long on price dips.
When traders start entering in an attempt to capture residual profits from the initial news, price will again surge.
Whether price make a new all-time high, or fizzles out will be determined by how credible the news that initiated the rally, is perceived to be.
The very fact that companies like Microsoft and Samsung are involved already lends credibility to IOTA.
We will be watching very closely.
We will be updating our subscribers as soon as we know more. For the latest updates on MIOTA, sign up below!
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.
Image courtesy of coinmarketcap.com