In three short weeks, Monero prices have more than doubled and why not? In my own opinion, this was expected and as long as BTC continue to gain traction and print record highs, Monero bulls shall keep pumping this cryptocurrency.
This pump is clear in the weekly chart where a confluence of patterns and technical indicators all point to a possible upswing. As the weekly chart shows, the past two candles were merely confirming the bull pressure after that bullish engulfing candlestick turning from around the 50% Fibonacci retracement level.
With the pump, Monero bulls cleared August highs and the 0% Fibonacci level meaning that the path towards 50% to 61.8% extension level is high especially if this week’s prices closes above August highs. We expect this to happen now that stochastics are strongly bullish and a buy signal has been printed.
Right now, we have a clear double tops courtesy of Monero price action failing to close above August highs of $166 in the past few days.
Then secondly there’s a stochastic sell signal coming a few days after that over-extension to the upside on November 23. In my opinion, this failure to close above August highs somehow hints at fading bull momentum especially now that we have lower highs relative to the upper BB and a bear candlestick on November 26 to top all this up.
In our entry chart, price action is now consolidating and literally cooling off after that steep bullish trend that begun on bullish break out on November 6. During this period of acceleration, the 20 period MA have been a reliable support line. It was not until during this period of consolidation did USD bulls try to test it.
From yesterday, we have seen Monero bulls bouncing back from this support line with complementing stochastic buys. Our immediate resistance line shall be key going forward now that the weekly chart is overly bullish.
However, since the daily chart is over-extended with a sell signal in place, any strong bearish candlestick closing below the 20 period MA will mean a natural correction is underway.
In that case, a Fibonacci retracement tool from break out lows of November 2 to recent highs of November 22