Coin of the week: EOS — Deep dive fundamental and technical analysis

What is EOS?

EOS is an open-source blockchain technology and dApp platform like Ethereum. It was founded by Dan Larrimer (Steem and Bitshares technology founder). Since its inception, it has been dubbed “The Ethereum Killer” as it aims to achieve 100k transactions per second (compared to Ethereum’s 15–30; ETH Casper will improve this however) with increased scalability as well. Furthermore, it’s ownership model removes transaction fees from the equation. It is currently an ERC-20 token but is scheduled for product release this June

Technology and Whitepaper:

The technology is what really defines EOS. As mentioned, they are aiming to achieve 100k tx/s speeds on their blockchain in an effort to support millions of users. In terms of the consensus mechanism it employs, EOS uses delegated proof- of-stake (DPoS) and it uses super nodes as part of the process. To summarize how this consensus works, validators serve a function similar to that of miners who secure proof-of-work systems. Community members will vote on delegates to represent them on the network, and these delegates are charged with accruing, processing and mining transactions into blocks. Blocks are produced every 3 seconds currently and being tested at 0.5 seconds. Their whitepaper claims that a transaction can be considered confirmed with 99.9% certainty after an average of just 0.25 seconds. EOS also uses server hosting and cloud storage, meaning that application developers can build and deploy applications and web interfaces with hosting, cloud storage and download bandwidth provided by the EOS system. Lastly, EOS uses Web Assembly for designing and coding dApps. Web Assembly basically takes the approach and web design and applies it to dApp development. This will enable quick porting of many code bases over to EOS which is currently one of the scaling issues effecting Ethereum right now as their dApps can only be coded in Solidity.

Team:

CTO Dan Larimer: Inventor of proof-of-stake and the concept of decentralized autonomous organizations. Founded BitShares, Steemit, and Graphene. CEO Brendan Blumer: Founder and CEO of ii5 and Okay.com. Advisor Ian Grigg: A financial cryptographer who has been building cryptographic ledger platforms for over 20 years.

Roadmap:

Phase 1 — Minimal Viable Testing Environment — Summer 2017

Standalone Node

Native Contracts

RPC Interface

Command line Tools

• Basic Developer Documentation

Phase 2 — Minimal Viable Test Network — Fall 2017

P2P Network Code

WASM Sanitation & CPU Sandboxing

Resource Usage Tracking & Rate Limiting

Genesis Import Testing

Interblockchain Communication Phase 3 — Testing & Security Audits — Winter 2017, Spring 2018

Develop Example Applications

Bounties for Successfully Attacking Network

Language Support

• Documentation & Tutorials Phase 4 — Parallel Optimization Summer / Fall 2018 Phase 5 — Cluster Implementation The Future

Catalyst Events:

**June 2nd, 2018: EOS will migrate from the Ethereum network to its own blockchain (EOSIO 1.0)***

Token Economics and Marketcap:

Max Supply: 1,000,000,000 EOS

Total Current Supply: 900,000,000 EOS

Current Circulating Supply: 818,472,896

EOS Current Price: $14.41 (0.00164096 BTC) Current

Marketcap: $11,792,393,798 USD

Competition:

As mentioned, Ethereum is EOS’ biggest competitor and aims to improve on Ethereum’s weaknesses (i.e. tx speed and scalability).

In terms of the market, ETH currently is #2 in marketcap at $62.3B (accounts for 15.7% of entire crypto marketcap). EOS is #5 with a $11.8B cap (2.9% of total crypto marketcap). However, it’s important to recognize that EOS is an infant compared to ETH.

EOS entered the market on July 2017. ETH entered August 2015. While we usually try to compare market action and growth in the same relative time frames of projects, this would not be accurate if done with ETH considering the overall crypto market was minuscule in 2015 at around $5B. Instead, we’ll take a look at how EOS has compared to ETH since its release.

As you can see, both projects have experienced similar action and have followed the overall market trends. June 2018 will be a very important time for EOS as it will move to its own blockchain (EOSIO 1.0) and may spark a new level of growth with new highs and lows. If EOS achieves the same marketcap value as ETH, that would place its coin price at around $76 for a ROI of 530% (not factoring in market growth).

Other competitors worth mentioning:

Lisk (LSK): $11.48 @ $1.2B cap

Waves (WAVES): $5.51 @ $551M cap

Stratis (STRAT): $6.14 @ $607M cap

Cardano (ADA): $0.29 @ $7.5B cap Icon

(ICX): $4.05 @ $1.5B cap

Neo (NEO): $75.7 @ $4.9B cap

Qtum (QTUM): $20.54 @ $1.8B cap

Quick TA

1h = Explain what’s previously happened from a technical perspective — understand the price action.

4h = The case for overextended and possible pullback areas to the down side. Daily = Targets to the upside on a continued rally.

EOS 1h: EOS has been on a rampage as of late, beginning with the massive price increase on April 10th, which was validated by a significant increase in volume as well. From April 10th through April 11th EOS price gained 51.79% Followed then by a 25.08% retracement over the next 3 days. From here, though, it was all blue skies as EOS kept rising, eventually finding resistance on April 20th at previous (local) highs, and in the process — revealing a well-defined bullish Cup & Handle Pattern. EOs retraced some, only the to be bought back up by the bulls on the slight price dip, as can been seen by the candle wick to the downside as highlighted in the chart here, indicating strong price rejection to the downside. From here we can see evidence strong market formation, as a clean double-bottom bull-pattern can be seen, where EOS begins to trade sideways for a short time before rocketing past local resistance of 134772 sats and making a new local high of 169751 sats on April 24th. From here, again, EOS reveals to us strong market formation with a well-defined double-bottom bull pattern with a higher low, coupled with significant price rejection to the downside as the candle wicks tell us the bulls are not letting price get any lower. Once EOS was able to meet, and thus breach resistance at 169751, a long entry could have been safely entered with confidence as volume also supported the rally.

EOS 4h Chart:

There is a lot to dissect here on the 4h, but we will be making the case the EOS for the short term has become overextended and is due for a pullback to key support levels, before continuing her march higher. The final chart, we will define key targets to the upside to consider taking profits if you’re long EOS currently. Let’s begin. The first thing that jumps out at us, is the divergence between price and RSI (yes, we know — typically RSI divs are drawn from the bottoms, however, just as effectively, you can gain a clear picture drawing RSI divs from tops on huge bull runs such as this).

Anyway, EOS price made a new (local) high, and RSI did as well, big time. RSI reached above 90, where it signaled it was extremely over bought, and thus the price cooperated and retraced (as detailed in the 1h chart previously). What’s interesting to note, is that once resistance was breached and price ran higher and made a new local high, RSI did not. Rather, RSI made a lower high at 84.5 — still overbought. Once more, we see price rapidly rise to a 3rd local high, yet RSI failed to do so once more, this time only touching 82 — still overbought nevertheless.

Using the Ichimoku system, we can clearly the TK cross (Tenkan crossing above the Kijun from below), which is bullish, yet it’s a weak-bullish signal as it occurred inside the Kumo. Nevertheless, the bulls came out in droves and kept the price running scalding hot. We also see price finding support at the Tenkan (blue line) and bouncing wonderfully off of it. THe most recent price action for EOS see’s 4 sizeable 4h candles consecutively where price is running away from the Tenkan to the upside, which indicates price is not in equilibrium, and a retracement can be expected soon, thus bringing balance to supply and demand. When price runs away from the Tenkan like this, it also impacts the performance of the relationship between the Tenkan (blue line) and the Kijun (red line), in that when the Tenkan and the Kijun become significantly separated, it’s reasonable to expect them to “clamp” back closer together. in this chart, that’s to the down side for a pullback after a respectable bull rally. So, what now: EOS has more fuel in her tank, no doubt. However, expect some pullbacks, and these are the levels to watch, as highlighted in this chart

Pullback level 1: 168076 sats (11.96% down from current price) — the Tenkan Pullback level 2: 156961 sats (21.51% down from current price) — the Kijun Pullback level 3: 138752 sats (27.17% down from current price) — below the 382 fib level

EOS Daily chart:

The best way we can find answers to where EOS may attempt to climb to, is by using the fib extensions. The 1.618 was a key level for EOS, and this proved to be no problem. Looking at potential accumulation (liquidity) zones before her next leg up, consider 181460 sats — 186896 sats near the 1.618 fib where price is now above, but hasn’t closed on the current daily candle…yet. The next significant target we see for EOS is the 2.618 fib level, which represents another 40% gain from current the current price

Recent News:

EOS Is Having A Huge Month; Will It Continue? https://seekingalpha.com/article/4165563-eos-huge-month-will-continue

The EOS testnet is here in 1 month. Here’s what to expect https://medium.com/@eosforumorg/the-eos-testnet-is-here-in-1-month-heres-what-to-expect-2ef546cac6f1

EOS Price: How to Buy World’s Fifth Largest Cryptocurrency https://www.inverse.com/article/44164-how-to-buy-eos

EOS Is Nearing An All-Time Price High https://www.coindesk.com/eos-eyes-new-all-time-high-amid-positive-news-flow/

The Bull And Bear Cases For EOS https://www.forbes.com/sites/ksamani/2018/04/25/the-bull-and-bear-cases-for-eos/#663a7f8842c0

EOSIO Dawn 3.0 Now Available https://medium.com/eosio/eosio-dawn-3-0-now-available-49a3b99242d7

Useful Links:

White Paper: https://github.com/EOSIO/Documentation/blob/master/TechnicalWhitePaper.md

Roadmap: https://github.com/EOSIO/Documentation/blob/master/Roadmap.md

Github: https://github.com/EOSIO

Sources: https://github.com/EOSIO/Documentation/blob/master/TechnicalWhitePaper.md

Happy trading. everyone!

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