TRON TRX price has rallied in step with the broader crypto market since the July 20 low, recording a 100% gain at the August 16 high of $0.098 level and confidently maintaining support above the July ascending trend line. Despite the noteworthy rally, TRX price 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.
From a long-term perspective, TRON's price has been plotting a cup-with-handle pattern since the January 2018 high. The April-July cyclical price correction has shaped the handle. The handle low is defined by superior support attributed to the confluence of the 50-week simple moving average and the 2020 high of $0.053. Now, TRX price 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 the TRON price above the left side of the base at $0.350.
Currently, TRON's price holds the 200-day SMA at a price of $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 TRX price range while hitting an extreme overbought condition does raise the probabilities of a deeper pullback, possibly down to the 50-day SMA at a price of $0.067. It would create a new entry price for TRX price speculators and the runway for the altcoin to resume the pursuit of a breakout from the cup-with-handle pattern.
The presence of the July ascending trend pattern and 200-day SMA may prevent a deeper pullback for TRON price, enabling a correction in time versus price. Once TRX price closes above the August 16 high of $0.098 and the high of the noteworthy price resistance level 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 level at $0.178 and the handle highs will also be a challenge for TRON's 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 the TRX price 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 price rally to the handle highs and a 100% return.
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