TRON has seen strong demand recently, but traders should be cautious about the following:


disclaimer: The following analysis results are the sole opinions of the authors and should not be construed as investment advice.

Bitcoin continued to maintain a range between the $28.7k support and $30.6k resistance. At the time of reporting, Bitcoin was trading at $29.8 million, the midpoint of this two-week range. TRON has been bullish on the chart over the past few days after the price moved for several days against the $0.07 demand zone. Despite the bullish short-term structure, TRON could see a pullback in the coming hours due to a reversal pattern.

TRX- 1 hour chart

Source: TRX/USDT on TradingView

TRX has been performing pretty well over the past few days, posting a gain of 15% over the past 5 days, despite Bitcoin trading within the range. The trend strengthened as TRX fell to $0.068 over the past few days and set a series of higher lows and higher highs on the chart. Since then, the price has tested the $0.07 area as demand and has moved higher.

The price formed an ascending wedge pattern (white) on the hourly chart when it reached the $0.082 resistance level. So we could see a retreat to the pattern base at $0.0775 or $0.076.

Volume was also significantly higher than the day before, so the bulls worked hard to break through the $0.082 resistance, but to no avail.

If TRX closes the session below the lower trendline and can offer a buying opportunity in the $0.0775 area, the chances of a withdrawal increase.

rationale

TRON has seen strong demand recently, but a pullback may be imminent.

Source: TRX/USDT on TradingView

The RSI on the hourly chart has remained mostly above its neutral 50 line for the past two weeks, while the Awesome Oscillator also continued to hover above 0, signaling bullish momentum. However, over the past 36 hours, the price has closed higher and higher and the RSI has been lower and lower.

This bearish divergence, combined with a rising wedge pattern, suggested that TRX is likely to decline in the next few hours. However, OBV continued to rise along with the price increase. Thus, there was strong buying volume behind the uptrend in TRX and it is likely that there will be further upside after the decline.

conclusion

The $0.075-$0.0775 area can be tested as a demand area if a pullback occurs. This area has been a strong short-term support area and there is potential for a rebound in this area. If TRON retests as support above the $0.082 level, the upward wedge pattern is negated.

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