The Graph price technicals project a rally that could push GRT to new highs
- GRT price is in a tight consolidation above the 50-day simple moving average (SMA)
- There is a high potential for one of the highest ROIs in the short term.
- However, The Graph is vulnerable to massive one-day swings.
GRT price for the last six days has contracted into a very tight range on light volume, showing a stand-off between bulls and bears. For traders, it is a timely trading opportunity with explosive upside potential.
GRT price has narrowed into an isosceles triangle
Like other standard triangles, prices in a symmetrica or isoscelesl triangles must touch each trend line at least twice and cover the area in-between. In general, volume declines during the pattern formation, with a 75% probability of an upside breakout.
The Graph price has shown declining volume through the triangle's development and has discovered support at the 50-day SM, just below the middle of the Bollinger Band. To confirm the breakout, GRT must close above the upper trendline on a daily basis and ideally near the high of the daily candle. The immediate price target is the upper Bollinger Band at $2.07.
The rally’s durability will be tested between the .618 and .786 Fibonacci retracement levels at $2.30 and $2.56. To add to the challenge, there is an area of price congestion on the left side of the triangle that converges with the retracement levels.
A successful push through the congestion will let GRT price test the all-time highs at $2.90 in short order and potentially the measured move target of $3, representing a 60% gain from the declining trendline.
GRT/USD daily chart
There is no doubt there is a substantial area of support for The Graph price as the ascending trendline intersects with the 50-day SMA and the lower Bollinger Band. A daily close below $1.57 would put the bullish narrative in doubt and leave the cryptocurrency exposed to a quick drop to the February low at $1.33.
Author
Sheldon McIntyre, CMT
Independent Analyst
Sheldon has 24 years of investment experience holding various positions in companies based in the United States and Chile. His core competencies include BRIC and G-10 equity markets, swing and position trading and technical analysis.
