NEM (NEM/USD) Analysis January 11, 2018
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.
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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.