Enjin Coin (ENJ): Breaking Away From the Important Resistance

August 15, 2020   Enjin Coin

One of the oldest cryptocurrencies, which was founded in 2009, Enjin Coin (ENJ), has been making significant progress lately while staying in line with the rest of the altcoin market that is booming right now, thus evoking the speculations regarding the next altseason. It must be noted that currently, we are witnessing an increased correlation between Bitcoin and many altcoins, something we haven’t seen since the bull market of 2017.

ENJ/BTC comparison chart

It doesn’t mean, of course, that the market is setting up to relive the events of 2017, but this peculiarity offers a hint with regard to the underlying bullish sentiment across the entire market, which, in its turn, points to the possibility of ENJ approaching the all-time high at $0.49, which is 53% from the current price of $0.229, by the year’s end, or even by the end of Q3 of 2020, considering the dynamics of market development.  

There is little that could hold down the bulls now


Traders who were foresighted enough to get involved with ENJ at least a week ago could already scoop up a nice 37% profit from the bullish sprint that took the price above the critical resistance level - now support - at $0.2, which, as you can see on the chart below, served as an ultimate magnetic point for the price throughout the entire existence of Enjin Coin. That is the level where ENJ got rejected after the bullish rally of 2019, which ultimately led to a prolonged correction and the market collapse. It also marked the starting point of another deep correction in 2018 after the burst of the crypto bubble.

ENJ historical chart

Therefore, if you went long on Enjin Coin some time ago and want to maintain this position in hopes of higher profits, then placing a stop-loss below $0.2 is mandatory at this junction, because the price might get rejected again and go into yet another correction. The probability of this scenario is rather low at the moment, but it would be foolish to disregard it, especially since the global economy is likely to suffer another blow caused by the second wave of COVID-19 that is already rising in Europe and Asia. As for the bullish scenario, it seems to be more realistic due to the following reasons:

  • The altcoin market, in general, possesses a lot of upside potential, mainly because the Bitcoin dominance keeps on sliding downward, despite the recent bullish endeavors. Since the end of July, the dominance decreased from 63% to 59%, thus fueling the growth of altcoins;
  • The historical chart demonstrates the virtual lack of serious resistance between $0.2 and $0.03, or even $0.4, which leads us to believe that even a slight push on the part of buyers could make ENJ skyrocket to the all-time high in a relatively short time;
  • If the US government released another stimulus package, a significant portion of it would end up in the cryptocurrency market, just like it happened when the previous once had been issued.

  

1-day ENJ/USDT chart

In conclusion, let’s have a quick look at the daily time frame to determine the scope of price action in the near future. Notice the big cluster of bullish volume that tends to increase, along with the growing green histogram of MACD, which is a sure sign that the bullish momentum is in full swing. Both Stochastic and RSI are in the overbought zones, although they have reached the extremes. Therefore, we predict another upswing to $0.25 before Enjin Coins starts retracing.

Author: Alex Paulson for Crypto-Rating.com
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