Like all other high cap alt coins that got a capital injection last week, NEM buyers are a little bit lax this week and guys, this is normal. It is even perfect for those wishing to get in after missing the party last week.
However, such explosions have their own problems and it won’t be surprising if bears push below the lower limit of the two key price levels under my radar at $1.3.
From the chart you notice that this level is the 3rd Fibonacci extension level or this week’s low. If there is a retest and close below then buyers would be waving the white flag signaling entry of sellers. That means trend shift and a path towards $0.94-the 2nd Fibonacci extension is open.
Given our position, we will have to stay on the sidelines until buyers jump in—if the latter condition actually happens.
Concurrently, I will watch $1.70; a resistance level where placing our buy triggers will be suitable if the main trend continues.
My “long candlestick’ concern is clearly depicted after January 3 candlestick was printed. It was a typical break out trade clearing $1.1 after periods of consolidation from December 20 to January 2.
Two things can happen going forward and in both scenarios, our perfect buy entries will be around $1.35 and $1.40. Either a retest begins as prices drop towards $1.1 or NEM expansion and clearance of $1.70.
The later is good for buyers but for those looking to enter on dips, a retest of $1.1 and middle BB is perfect.
In we have seen, sellers are temporarily in charge and from our entry chart, our main support line is at $1.3, the 61.8% Fibonacci level drawn from last week’s high low.
I will recommend longs if and only if NEM prices close above $1.62. If not-and prices continue to depreciate, then we should be prepared for a $1.1 retest. After all, it’s at 78.6% correction level.