- TRON price shaping the handle of a cup-with-handle base on the weekly chart.
- TRX daily Relative Strength Index (RSI) remains overbought but below the extreme reading of 83.06 plotted on August 16.
- TRON price respects July ascending trend line on August 19 with a 4.03% bounce.
TRON price has rallied in step with the broader cryptocurrency market since the July 20 low, recording a 100% gain at the August 16 high of $0.098 and confidently maintaining support above the July ascending trend line. Despite the noteworthy rally, TRX has reached a resistance level that corresponds with the April lows while flashing an extreme overbought reading on the daily RSI. The preconditions for a deeper pullback are coming into focus.
TRON price is an opportunity wrapped in mystery
From a long-term perspective, TRON price has been plotting a cup-with-handle pattern since the January 2018 high. The April-July cyclical correction has shaped the handle. The handle low is defined by superior support attributed to the confluence of the 50-week simple moving average (SMA) and the 2020 high of $0.053. Now, TRX is aiming to complete the right side of the handle in the coming months.
The measured move target of the cup-with-handle base is $0.370, putting TRON price above the left side of the base at $0.350.
TRX/USD weekly chart
Currently, TRON price holds the 200-day SMA at $0.078, and the July ascending trend line but is confronting the resistance established by the April lows and the TRX rebound highs that followed the May 19 collapse around $0.095.
The test of the TRON price range while hitting an extreme overbought condition does raise the probabilities of a deeper pullback, possibly down to the 50-day SMA at $0.067. It would create a new entry price for TRX speculators and the runway for the altcoin to resume the pursuit of a breakout from the cup-with-handle pattern.
TRX/USD daily chart
The presence of the July ascending trend line and 200-day SMA may prevent a deeper pullback for TRON price, enabling a correction in time versus price. Once TRX closes above the August 16 high of $0.098 and the high of the noteworthy price resistance at $0.099, it will not encounter any serious technical obstacles until the 38.2% Fibonacci retracement of the 2018-2020 secular correction at $0.137.
The 50% retracement at $0.178 and the handle highs will also be a challenge for TRON price if the 38.2% retracement is shattered. It would represent a 100% gain from the current TRX price.
TRON price is at an inflection point as it battles a challenging range with an overbought daily RSI. Subsequently, the mystery is whether TRX can beat the resistance mentioned above without a meaningful pullback. Or, does it need to refresh the price structure and technical indicators to master a sustainable rally to the handle highs and a 100% return.