Has Alien Worlds’ Trilium (TLM) bottomed?

NFT-Based Gaming Trend

Following the rallying trend of the more popular crypto game, Axie Infinity (AXS), the crypto utility token Trilium (TLM) for the NFT-based game Alien Worlds may have already bottomed this month.

After losing more than 90% of its value since the crypto crash of May 2021, it has shown tremendous resilience from its lows of 0.0663. Just this week, Trillium’s price reached a high of 0.3313, which represents a gain of almost 400% in less than two months. It has gained tremendous following and traction, due to its use case for the game, Alien Worlds.

Alien Worlds’ Game Utility Token

In the game, the players use Trilium (TLM) to purchase items, engage in battles and compete in-game quests. It can also be mined and staked to redeem potential rewards. Players are incentivized through earning TLM by simply playing the game. As such, the Alien Worlds ecosystem has grown exponentially. It was reported in April 2021, that the trading volume had increased by 1,088%. At the same time, traders and sales increased more than 200%. Currently, Trilium’s market capitalization is at $189 Million, making it the 236th largest cryptocurrency in the world.

TLM Trade Idea: Two Potential Scenarios

TLM recently rallied above its 50-day moving average (gray line) for the first time since the crypto crash of this year. The volume traded has also picked up tremendously, as the price moved higher than its 20-day (yellow line) and 50-day moving averages. This suggests that we may have seen the bottom for TLM.

This week’s recent rally above 0.3000 has proved to be short-lived, as traders immediately sold as soon as it moved above the psychological round number, resistance area. This may only be a short-term profit-taking correction as a result of the explosive rally for the month of July.

I see two potential trade scenarios that could occur for TLM in the near term: a pullback to support areas, and a potential parabolic move, similar to its NFT-game counterpart, Axie Infinity (AXS).

Scenario 1: Buy on support lines

In order to capitalize on a potential rally of TLM, wait for signs of selling exhaustion. For a low-risk entry point, you would need to catch the price at support levels. The idea is that TLM would first create a base consolidation before resuming its upward trend – a rather more tempered, realistic projection than the second scenario below.

The major dynamic support level would be the 50-day moving average (0.1329 at the time of writing). Buy tranches when the price reaches this level and put your stop-loss at TLM’s all-time lows of 0.0663. Risk only 0.50% of your portfolio for this trade.

Scenario 2: Buy on Momentum

It would seem that AXS and TLM are directly correlated due to their nature and use case. With the price increase of AXS, players may now be looking for a cheaper alternative to Axie Infinity, and TLM may be just that. With the AXS reaching parabolic status this month, we may see TLM do the same as well.

The Average Directional Movement Index (ADX) of TLM is currently at 36.98, which suggests that the rally may not be over yet. Add to the fact that the trading volume in the past four days has been the highest ever. The NFT-based game trend may be spilling over onto TLM.

Today’s correction may only be a temporary one. Wait for a bullish flag pattern to appear before entering. Buy at the breakout and put a tight stop-loss at the bottom of the flag pattern, in order to capitalize on the potential momentum move. Sell immediately if the price does not follow through. Risk only 0.50-0.75% of your portfolio for this trade. Do not enter if there is no flag pattern.