Crypto assets were crushed over the weekend on nothing more than comments from some guy on Twitter. Are these lower prices an opportunity for longer-term investors and traders?
If so, we’ll take a quick look at longer-term charts on Chainlink, Cardano, and Uniswap to see where we can watch out for potential bullish patterns to form.
LINK is the token that powers the Chainlink network, a protocol enables access to data and off-chain computation to smart contracts. It’s one of the biggest projects in the crypto space with a market cap of over $15B, and for longer-term investors, it could be a way to diversify exposure to the emerging crypto ecosystem.
In May, the price of LINK has fallen from ATH at around $53 to a low in today’s session at the $35 handle. That’s a big 35% drop, and with the pair now testing the rising ‘lows’ pattern and broken resistance area, we could see high conviction investors jump back in to add to their bag.
Uniswap is arguably the top decentralized exchange on the block right now, providing $6.8B in liquidity on 36K token pairs to crypto traders. So, it’s no wonder that the token has massively gained in value as the crypto space has exploded, spike up as high as 1,000% in 2021 before taking a dip this weekend from an ATH at $45 to trade around $33 currently.
That $33 handle was a very strong area of interest for UNI/USD from February through May, acting as both resistance and support. This area also intersects with a rising ‘lows’ pattern, and with stochastic nearing an oversold signal, we could see longer-term buyers hop back in if we see bullish reversal patterns form.
Last but not least is Cardano, the decentralized, layered blockchain project that was founded by Charles Hoskinson, a co-founder of the Ethereum Network. It’s been billed as a “potential ETH killer” as some view the academic rigor it was developed with gives this project the potential to be a better smart contract / decentralized app platform than the Ethereum network. I guess we’ll just have to wait-and-see which platform prevails when Cardano releases the ability to build smart contracts, possibly at the end of this month (Cardano Prepares to Launch Alonzo Testnet).
ADA/USD was actually able to weather the storm that Elon Musk brought to the currency markets this weekend, making new all-time highs at $2.46 before eventually falling with the rest of the crypto space on Sunday. With stochastic still signaling overbought conditions, ADA/USD could fall further and if it gets to the previous consolidation area (between 1.50 – 1.80 range), we’ll be watching out for bullish reversal patterns to potentially gain exposure to this very promising project.
What do you guys think? Is this broad market dip a long-term opportunity to invest in crypto assets? Or will the sellers take the market even lower?
Let me know in the comments below, and as always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.