Neo looking for support
Neo went back and forth in relatively quiet trading on Wednesday, as we have reached a large round figure in the form of $11. Beyond that, the 50 day EMA is sitting in the same neighborhood, so it makes sense that perhaps there could be a bit of technical buying at this point. Remember, just as we see round numbers move markets in traditional financial situations, they also tend to move crypto markets the same way.
Crypto currency moves simultaneously
Looking at the charts, you can easily see that all crypto currency eventually follows Bitcoin. As bitcoin has been rallying the last several weeks, it makes sense that several other coins have done relatively well. Looking at the chart, you can see that we are sitting on top of that crucial 50 day EMA, and that of course will attract a lot of attention by itself. Marry that with the idea of Bitcoin stabilizing, then you have a scenario where Neo can perhaps find buyers as well.
I know it seems like an oversimplification, but the reality is that Bitcoin is where the volume is found in the cryptocurrency markets. That doesn’t mean that you can’t take advantage of altcoins, but you need to keep in mind that they will move much quicker. Neo is one such coin at times but being so reasonably priced makes it a nice alternative.
There is significant support underneath not only due to the 50 day EMA, but quite frankly the $10 round figure as well. Because of this, I believe that short-term pullbacks will probably attract a certain amount of attention that people will be willing to take advantage of in order to pick up “Neo on the cheap.” That being said, if the $10 level gets broken to the downside, that could be very telling as well. However, I would only be concerned about Neo breaking through that level if Bitcoin starts to break down significantly as well.
Without a doubt, the most obvious target could be the $15 level, as we had formed a shooting star several days ago right at that figure, and of course it is a whole figure that people will be paying attention to. Above there, we have the 200 day EMA which is sitting at the $16.06 level currently, so I think there is a lot of resistance to be found in that general vicinity. If we do break above the 200 day EMA, things get very interesting to the upside as $20 will certainly be targeted.
The main take away
The main take away from the Neo market is that value is starting to present itself. Traders will be more than willing to jump in and pick up the value if history is any indicator, and therefore it’s very likely that Neo is essentially “on sale” currently. Just make sure that you pay attention to Bitcoin, because it has a psychological influence on the rest of the crypto currency markets. All things being equal, Bitcoin should give you an indication on how to make money here.