Suppose buy momentum pick up from here then we can rightly say that the depreciation took a couple of weeks but the aftermath wreaked havoc to several coin’s portfolios.
In the weekly chart, we can see that one month after Lumens tokens were over-priced, prices corrected and it didn’t take long for bears to be flirting with the middle BB. That is our main support line.
Considering the speed of this erosion, it was our expectation that bears could breach and close below $0.30 as sellers aim to test the middle BB as they complete the second phase of a possible break out pattern.
However, as it is, buyers are back and we can easily tell that from the long lower wick that this week’s candlestick has. If this is sustained then we shall have to refine buy entries in lower time frames.
Obviously, Lumens buyers are rejecting lower prices. Look at the double bottoms turning away from December 2017 highs.
By doing so, $0.30 significance has been cemented and what we should be watching out now is if bulls may actually close above the $0.40 or the 61.8% Fibonacci retracement level.
Of course, the double bar reversal pattern will be a good anchor point for buyers but still, the middle BB remains a resistance line and we need today’s prices to erase yesterday’s bear pressure.
Remember, from previous analysis we said that as long as prices are below this liquidation line then our bearish skew holds. So far, these conditions have not been violated despite pockets of bull pressure.
Now, here is the thing, if today end up bullish then it would be wonderful sign for buyers. We should remember that the last time prices were above the middle BB was 10 days ago when prices dropped from $0.70.
Yesterday we saw this close above resistance, a correction back to it and a resumption of buys following that minor double bar reversal. It will be risky to buy without confirmation but buyers can decide to scalp with immediate targets at $0.43 and long term targets at $0.70.