NEM (NEM/USD) Analysis January 31, 2018
Fundamentally, NEM was expected to tank after that heist at Coincheck but surprisingly, the coin appreciated.
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Will there be a system risk if all those coins are to be dumped all at once by those hackers? I assume even if they were splinter groups, they had one mission statement meaning they were under one umbrella in one perfectly coordinated heist.
It recovered yes but for the past two days, sellers are beginning to buy into the FUDs as the coin’s value move lower. Technically-and from the way price action has been moving in the last couple of weeks, sellers are in charge and week ending January 21 lows will be this token’s price support.
This effectively puts NEM price action within the 1st and 2nd Fibonacci extension levels and even if prices move lower, tags around the middle BB in this time frame is where immense buy pressure is expected. Anyhow, NEM looks to be receiving the short end of the stick and could erode further.
In the daily chart, January 27 bullish candlestick is conspicuous and under normal circumstances, that could-and is still-a perfect buying opportunity.
Besides that, notice that this formed right at the 61.8% Fibonacci retracement level drawn from recent high lows. As we have mentioned, chances are that prices be confined within key Fibonacci extension lines in the weekly chart.
Extrapolating that view and relating to price action viz a viz the middle BB in the daily chart and you notice the liquidating effect of this resistance line.
Anyhow, the general trend is bearish but for that to be certain, we need prices to close below last week’s lows at $0.75 but for that to happen, January 27 gains must be reversed.
That is likely to happen today.
January 27 bull candlestick was a bullish break out above the main resistance trend line in the 4HR chart happening right at the apex of an ascending wedge.
For buyers to gain traction, we must see reaction along the minor support trend line. If not and prices surge below the minor support effectively recouping January 27 gains, then sellers would continue to off load this coin as they aim $0.50 in the coming sessions.
After all, that would mean a bearish harami if today’s close as a bear in the daily chart right?