EOS price remains in a bear market despite ongoing optimism on the cryptocurrency market

EOS price remains in a bear market despite ongoing optimism on the cryptocurrency market
Written by:
Stanko Iliev
18th November, 20:10
  • According to the rules of technical analysis, the main trend of EOS still remains "bearish"
  • EOS price is still not able to surpass the $3 resistance as sellers remain in control of the price action
  • If the price falls below $2 it would be a strong "sell" signal and the next target could be located at $1.5

The cryptocurrency market is advancing this week but the EOS price is still not able to surpass the $3 resistance level as sellers remain in control of the price action. The main reason for this is a low transaction volume and the fact that EOS investors faced trust issues.

Fundamental analysis: There’s still a level of uncertainty

EOS is a blockchain-based decentralized operating system that enables businesses to build blockchain applications in a way similar to web-based applications. Elimination of transaction fees and scalability are two major features of the software.

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Some analysts say that this cryptocurrency has a positive long term outlook because EOS could replace Ethereum as the dominant smart contract platform. Investors in EOS should have in mind that this is a still very risky cryptocurrency but now could be a good time to trade EOS.

The price of EOS has weakened from $3.8 below $2.30 in less than three months and the current price stands around $2.58. The main reason for this is a low transaction volume and the fact that EOS investors faced trust issues.

EOS investors faced trust issues since the U.S. Securities and Exchange Commission (SEC) slapped a $24 million penalty to Block.one (EOS’s parent company). The reason for this was an unregistered initial coin offering and the investors started to have doubts over the project’s long-term viability.

Transaction volumes have become smaller and analysts found out that people use EOS for placing small bets instead of value-transfer purposes.

Technical Analysis: The main trend of EOS remains bearish

Data source: tradingview.com

According to the rules of technical analysis, the main trend of this cryptocurrency still remains “bearish”. The current resistance levels are $3 and $3.5, $2.5 and $2 represent the strong support levels.

If the price jumps above $3 it would be a signal to buy EOS and we have the open way to $3.5. Rising above $3.5 supports the continuation of the bullish trend and the next price target could be located around $4.

On the other side, if the price falls below $2 it would be a strong “sell” signal and we have the open way to $1.5.

Summary

Most of the major cryptocurrencies have advanced this week but the price of EOS is not supported by this situation. EOS price has been moving in a downtrend last several months and for now, there is no signal of the trend reversal. The main reason for this is a low transaction volume and the fact that EOS investors faced trust issues. If the price falls below $2 it would be a strong “sell” signal and the next target could be located at $1.5.

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