- $70 level offering massive support
- signs of a bounce during early Wednesday session
- previous support just below
- crypto starting to wake up again
Monero drifted a little bit lower during the early hours on Wednesday to reach down towards the $70 level. However, this time the market didn’t slice right through that level, but rather bounced again. At this juncture, it looks as if the market is trying to turn things around at what has previously been a very crucial level. This is an area that has offered support more than once. In fact, it has even done so rather recently.
Technical analysis of Monero
Monero is essentially a market that is trying to find a bottom. The $70 level has been massive support that extends down to roughly $65, and although it has been falling for some time, it is worth noting that we have done a complete return from the initial surge higher. Quite often, there should be a significant amount of support at these levels, so the fact that we have bounced is not a huge surprise.
That being said, there is a significant turnaround at this point, and it looks as if the market has a lot of work to do to start rallying over the longer term. The $80 level above features a couple of shooting stars, and of course the 50-day EMA. All of that will be a massive wall of resistance. However, if the market was to break above that level, it would be extraordinarily bullish, sending fresh money into the market.
In that scenario, traders can look for confirmation in the Bitcoin market, as it drives crypto in general. If Bitcoin is falling, it is very unlikely that Monero will rally. After all, a huge portion of crypto trading is done in Bitcoin. So, much like the stock market, traders will need to see the leaders acting in the right manner.
Trading Monero going forward
Trading Monero going forward is going to be about trying to find whether the buyers can make a stand between the $70 level and the $65 level underneath. Momentum will enter the fray if the market can break above the $80 level, which should send this market much higher based on a resistance level being broken. At that point, it’s likely that the market will go looking towards the next resistance barrier in the form of the $90 level, followed by the $100 level.
The alternate scenario is that the market breaks below the $65 level, looking towards $60 underneath and then eventually $50. This is a major, psychologically important level, so traders will have to re-evaluate the entire situation. All things being equal, it does appear that the buyers are trying to make a stand here, so the next couple of days should be crucial to determine where Monero goes next. With the various levels around current trading, the intention of the market should show itself rather quickly.
- Monero testing major support level from previous trading
- Monero entering value area
- Central banks continue monetary policy
Monero has pulled back a bit during the trading session on Friday to close down the week but is finding a bit of support just below the $70 level. Monero has been somewhat left in the background as Bitcoin has captured all of the headlines lately. All things being equal it’s likely that the market is going to find some type of support though because we are starting to bounce. Beyond that, this is an area that has previously been supportive, so it makes sense that it should continue to be a market that finds buyers based upon value as Monero is “cheap” at the moment.
Monero has been falling for some time, so it has become cheap as mentioned, and as it is an alternative crypto coin, you should keep in mind that it’s going to follow what happens with Bitcoin. Monero is much cheaper to trade than Bitcoin, and therefore much more relatable to the average retail account. This is why the market could bounce, in reaction to Bitcoin in general showing signs of life.
If Bitcoin starts to rally significantly, then Monero should right along with it. The initial target could be $80, but quite frankly with the Bitcoin market likely to go higher, this is most likely going to follow right along. Beyond that it’s very likely that the market could go higher than that if Bitcoin continues to show signs of strength.
The alternate scenario
Monero could break down, and we should keep that in mind. The $60 level underneath would be massive support, so if it were to give way to selling it’s very likely that there would be a bit of a “flush lower” in the Monero market, including the Bitcoin market also. Quite frankly, if Bitcoin breaks down that will drag this market right along with it. In other words, the Bitcoin chart should be your secondary indicator when it comes to trading Monero.
If we do get the break down in this market, the $50 level would be the initial target, but quite frankly it’s just as likely that we could go down to the $40 level as it was a major basing level for the longer-term trend to the upside that we are pulling back from. Overall, this is essentially a “binary trade” meaning that the market will either find this area to bounce from or it won’t. This is very much like the Bitcoin market which is currently testing the $9250 level in the exact same manner. Pay attention to that market and how it reacts to that level, it will be at least half of the reason why Monero would rally or fall. Another thing to keep in mind about Monero is that it tends to move and $10 increments, so keep that in mind when adjusting stop losses and perhaps targeting as well.