The main driver behind Monero is the shift of capital otherwise meant for BTC. It is without doubt that despite the Bitcoin-Segwit scaling solution, users are finding the network inefficient with transaction time and costs rising with every new user in the system.
Bitcoin alternatives like Monero on the other hand are more secure, cheaper and can be scaled allowing user on-boarding in the near future. The proposed Segwit 2X was meant to cure this problem but the Bitcoin core developers and influencers like Bitpay CEO Stephen Pair were in the forefront urging miners with hash power to reject Segwit 2X.
Now there is a backlash and BTC cryptocurrency market share has been mowed to 52.2%. A case in point is on November 10, BTC dropped by more than $1000 while Monero, DASH and BCH are appreciating in multiples right after November 8 Segwit 2x cancellation.
Prior to last week’s bullish engulfing candlestick, the previous 2 weekly candlesticks had conspicuous long lower wicks indicating bull pressure. This reversal also happened around the 20 period MA support line and now there is a stochastic buy signal in place.
In the daily chart, we notice two technical developments that cement our bullish forecast. On November 9, Monero price action over-extended and closed above the BB. As expected, the correction towards equilibrium was swift but then look at how the main resistance line at $100 acted as support. Matter of fact, this same level was at the 50% Fibonacci retracement level if tool is pasted between August-September Hi-Los at $152 and $61 respectively.
Secondly, the main resistance trend line was broken following that double bar reversal pattern bouncing from resistance. Price action is hugging and moving along the upper BB meaning bull pressure is high and with anticipation, any pull back towards $114 offers perfect buying opportunity.
In the 4HR chart, it is safe to only take longs with sentiment as main drivers. Already, this pair is trading within a break out strategy with a break out and retest of $100 support line completed last week. There is a stochastic sell signal in place. If you place a Fibonacci retracement tool between $137 and $85 Hi-Los recorded last week, potential buys fall at around $110 and $115 zone. Advised by this, I advise Monero bulls to enter at better prices by waiting until a buy signal is printed ideally at around 50%-61.8% Fibonacci levels.