TRON (TRX) has been forming distinct market structures across multiple time frames, providing clear insights into its potential direction.
While the daily chart highlights a possible reversal, the lower time frame reflects a consolidation phase within a descending wedge.
This analysis delves into the broader context and projects short-term price movements.
The daily chart of TRX shows a pronounced descending wedge formation after a sharp retracement from its $0.45 high on Dec. 3.
Historically, descending wedges often precede bullish reversals, and TRX appears positioned for such a move if it breaks above the wedge’s upper boundary at $0.267 (0.618 Fibonacci retracement).
The price action has respected the 0.786 Fibonacci retracement level at $0.218, which has acted as a crucial support zone during this correction.
The daily Relative Strength Index (RSI) remains neutral, recovering from oversold conditions, but it still needs a decisive breakout signal to confirm bullish momentum.
Potential resistance levels on the daily time frame include $0.267 (0.618 Fibonacci retracement) and $0.3023 (0.5 Fibonacci retracement).
If the descending wedge resolves upward, TRX could target these levels before continuing its rally. However, a failure to hold $0.22 could lead to a deeper retracement toward $0.1563 (1.0 Fibonacci retracement), invalidating the bullish outlook.
The 1-hour chart reveals a more detailed view of the ongoing consolidation within the descending wedge. The wedge’s structure aligns with an ABCDE corrective wave count.
Elliott Wave analysis suggests that the corrective wave “E” is currently concluding, setting the stage for a potential impulsive move.
A breakout from the wedge would likely confirm the beginning of a new bullish phase.
In a bullish scenario, TRX could target $0.267 (0.618 Fibonacci retracement) initially, with potential extensions toward $0.302 (0.5 Fibonacci retracement) and $0.336 (0.382 Fibonacci retracement).
The RSI on the 1-hour chart shows neutral momentum, but any divergence near key levels may act as an early signal for the breakout.
Conversely, if the price fails to hold support at $0.218, the descending wedge may break downward, targeting $0.20 or even $0.156.
This bearish scenario would align with a continuation of the corrective phase rather than a breakout into impulsive bullish action.
The immediate trajectory will depend on how TRX interacts with the wedge boundaries and whether volume confirms the direction of the breakout.
TRX is approaching a critical decision point, with its next move heavily reliant on the wedge’s resolution.
Traders should focus on RSI divergence and volume spikes near key levels to confirm breakout or breakdown scenarios.