NEM price analysis: XEM dips hard as it breaks the triangle formation
- NEM dipped close to 20% on the day as it broke a crucial formation.
- After breaking the triangle formation down, XEM is now trading in a narrow range.
- The cryptocurrency has a stronger chance to continue moving down in the short-term, according to analysts.
NEM (XEM) has dipped close to 20% on the day, making it the worst-performing cryptocurrency in the market cap top20. What’s the reason for the dip, and should you consider buying some XEM now?
Fundamental analysis: NEM’s solid fundamentals currently not affecting the market
NEM has had a bad trading session today as bears took over the market and brought its price down close to 20% from the value it had yesterday. This sudden dip came as a result of a technical formation, and had close to nothing with NEM’s fundamentals.
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In fact, NEM’s fundamentals are extremely positive as the team behind it constantly strives towards creating new partnerships. Just two days ago, on 8 March, NEM announced a strategic partnership with Staked. This partnership would expand staking access to US institutions, exchanges, and high net-worth individuals.
XEM posted week-over-week losses of 27.95%, heavily underperforming both BTC‘s week-over-week gain of 10.49% and ETH‘s 13.47% gain. NEM is currently the 18th-largest cryptocurrency by market cap, boasting a value of $5.20 billion.
At the time of writing, XEM is trading for $0.59, which represents a price increase of 48.19% when compared to the previous month’s value.
XEM/USD technical analysis: XEM breaks the triangle formation to the downside
XEM has been trading within a triangle formation ever since 3 March, when its price reached past $0.8. However, today’s trading session got taken over by XEM bears that broke the triangle formation down. This caused its price to drop from $0.7 all the way down to $0.53 before recovering and finding support.
XEM is currently trading just above its $0.585 support level, which held up nicely to the bear pressure. However, if the strong volume continues, this level may fall as well. XEM’s RSI on the 4-hour chart has dipped into the oversold territory, with its value sitting at 28.55.
Taking a look at the hourly time-frame, we can see exactly how XEM dropped to its recent lows, as well as how it recovered to the levels it is at now. The cryptocurrency is now trading within a narrow range, bound by the zone between $0.577 and $0.585 to the downside and the $0.61 resistance level.
Even though its fundamentals are quite solid, XEM has a stronger chance to continue its path down, simply due to the amount of resistance present in the $0.61 level and the 21-hour and 50-hour EMAs. However, this might be a good time to value-invest into this project, as its current price is (according to numerous analysts) not matching its fundamental improvements.
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