A Day In The 100 — Nano

Co-written by Alec Ziupsnys

This is the third week of “A Day In The 100”. We break down a coin or token from the top one hundred market cap and cover current price, but also add more depth as that price relates to trading and investing.

The project and fundamentals will be first and then we will work our way into more cyclical and technical analysis.

Fundamentals

Nano is an alternative to fiat currencies, aiming to be faster and more efficient than Bitcoin and any of its clones. With a fast and minerless (FFM) structure, similar to IOTA, Steem and EOS, Nano offers a more advanced structure then Bitcoin. Using an architecture called “block lattice”, there is no long single chain of blocks. It is more of a database of different chains where each user gets their own blockchain that is only added to by them.

For every transaction on the network, two blocks are created. A send transaction subtracts from your current account balance and then a receive transaction, initiated by the recipient, adds to the receiver’s balance. For the transaction to be completed, the recipient will need to sign the block. These two actions do not have to happen at the same time. If the recipient is offline, it will be settled at the next available opportunity.

To explain this, if a user wanted to send XRB (the coin on the NANO network), the difference between the send block you just created and your total balance on the previous block is done to verify your transaction. When looking from the receiver’s point of view, the send amount would be added to the their account chain’s preceding block. This results in a new block being formed that is a record of an updated account balance of each user.

Nano cuts out the need of miners by requiring the sender and receiver to verify the transactions. All of these transactions are handled off the main Nano blockchain which allows for much more scalability. The blocksize (how much data can fit onto a single block) debate has been pretty loud lately, however with the Nano protocol there is no need for nodes to store the entire record of the network. They only need to store their own individual transactions.

With a bigger spotlight on currencies and the growing pains associated with adoption, Nano is aiming to be a major competitor in the space. A project that offers user an alternative to Bitcoin’s problems is in a great position as time moves on.

Technical and Cyclical Analysis

We haven’t had a position in this but it’s a name we like based on some of the research we’ve done. The coin has been re-branded so we don’t really have a great chart to work with. Looking at the chart below, it’s worth pointing out that any coin where the price basically goes vertical and then does an 80% retrace, which has been very common in the space, is now at a level where it makes sense to start buying back in. In this case, the market essentially went from 32 back to 8 so you want to take some profit when price creates that angle and distance and then now’s the time to start adding back.

Sorry, not the best chart to work with….

We’ve been making lower highs so the market is still in an intermediate-term downtrend. Using this unfortunate chart, we estimate a key lower-high pivot to watch is right around 11 or 12. We’d be looking for price to move above this level, start making higher highs in the intermediate-term again, and perhaps then the momentum would be back to being bullish again.

Let’s take a look at some other charts. Below is the 4 hour chart versus Bitcoin on Binance. Not a great looking chart but the key takeaway here is that price has made nothing but lower highs, which is indicative of a downtrend.

The highs from the 12th stand out on the hourly chart and this area now becomes a key pivot to watch price try to get back above. The Wave Formation Bands are currently all negative, showing the intermediate-term down move. However, the market has stopped making new lows relative to Bitcoin and now we’ll see if price can turn the corner and start moving higher, turning the bands positive along with it.

It’s pretty much the exact same story versus Ethereum.

So longer-term, this is probably the area to start nibbling and then look to add to the position once price starts making higher highs. That gets you on what we call the right-hand side of the cycle. It’s unfortunate we don’t have a lot of chart data to work with yet, but it makes sense that any risk be limited to below the recent market lows.

Watch Jason’s analysis of Nano here

There are a lot of traders looking for exposure to the cryptocurrency space and do not know where to start. We want to make the transition to this new asset class as seamless as possible while also assisting in on-ramping new traders already familiar with the technology. We will do our best to present an honest and unbiased view of these projects and how we are looking to trade them.

Please comment below with any feedback you have!

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RISK DISCLOSURE:

Trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

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