Lisk (LSK/USD) Analysis December 18, 2017
Lisk price action is unique and like similar platforms as ETC, NEO and NEM, this cryptocurrency is in my opinion under-valued.
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In the weekly chart you notice that even though August highs of $8.63 were cleared after that strong bullish candlestick by week ending November 19, there has been no confirmation. All we are seeing in lower time frames and especially the daily chart is horizontal consolidation within the $8 range defined by November 19 high lows.
Overly, we are bullish advised mainly by the close above August highs and failure of bears to drive prices below $6.3 main support. Additionally, stochastics are bullish with weekly candlestick close slowly higher and away from the 20 period MA.
If we paste our Fibonacci extension tool between August-March high lows then our first take profit level is projected at $13.55 and that is where bulls should be aiming at. In the run up to that ideal target, the 20 period MA should be our support and if there is a close above last week’s highs of $11, then we shall shift our support level to August highs at $8.6.
The horizontal consolidation mentioned above is evident in the daily chart. As the chart shows, right after that bullish break above from our main bullish wedge on November 8, prices moved higher but found resistance at $12.
According to the Fibonacci retracement pasted between November 2 and 16, LSK prices corrected 78.6% before support was found and price action continued moving higher according to the direction of break out.
We already have a stochastic buy signal and after December 12, bullish candlesticks have continued to band along the upper BB. Even though we have a little bit of bear pressure, we strongly believe that Lisk shall continue inching higher.
In fact today’s candlestick shows long lower wicks meaning bulls are rejecting lower prices.
Our entry shall be viewed from different angles. First, we are bullish so we shall be taking long positions only.
Secondly, there is a stochastic bear signal with a strong bearish engulfing candlestick in the 4HR chart and thirdly, the minor resistance-now support trend line in our entry has been tested.
Since we are overly bullish and the current set up is bearish, we shall place a buy stop above November 16 highs at $11.50.
If the current bearish engulfing pattern is confirmed and bears drive prices below the 20 period MA towards $8.3, then we shall cancel that buy stop and look to enter at better prices when a stochastic buy signal is printed and confirmed by a bullish reversal candlestick.