Analyzing Virtuals Protocol’s bounce from golden pocket – Will $1 be next?
The 4-hour chart revealed why VIRTUAL traders should be bullishly biased after the defense of the $0.66-$0.68 support on Monday.
Virtuals Protocol [VIRTUAL] witnessed an 83% boost in daily trading volume and saw a 3% price gain in the past 24 hours. Its Open Interest [OI] was only up 1.75%, which suggested speculative conviction behind the AI token was relatively weak.
Coinalyze data showed that the Funding Rate was predominantly negative over the past week.
At the same time, the Spot CVD has been flat. Combined with the weak increase in OI, it showed that the VIRTUAL market sentiment remained bearish.
Let’s break it down from the higher timeframes.
On the 1-day chart, the trend was bearish. The swing structure was bearish, and a set of Fibonacci retracement levels (white) was plotted using this.
At the same time, the internal structure was bullish.
The price faced rejection from the $0.82 level, the 50% retracement (white), but the $0.68 local support zone was defended.
This meant that further gains were likely. With Bitcoin [BTC] also back above $70k, the next week or two could see the bulls in control.
Virtuals Protocol token has completed its retracement
A week ago, AMBCrypto pointed out that downside risks were present for the popular AI token. This warning has been proven right, with VIRTUAL retracing from $0.82 to $0.64, a 22% move at its zenith.
This retracement was a healthy one for the bulls in the short-term. At the same time, the long-term structure was bearish. Traders can wait for a move toward $1 before they can begin to anticipate a bearish reaction.
The 4-hour timeframe showed that the $0.665 level was the 78.6% retracement (light blue) of the previous impulse move VIRTUAL made, from $0.62 to $0.82. A bullish reaction at this key retracement level confirmed this bias.
Therefore, it is highly likely that Virtuals Protocol token prices would rally toward $0.875-$0.955 levels next. These were the 23.6% and 61.8% extension levels of this timeframe’s swing structure.
Final Summary
- Virtuals Protocol exhibited a negative Funding Rate and low Open Interest despite its gains in the past 24 hours.
- The defense of the $0.66-$0.68 zone confirmed bullish strength and VIRTUAL could rally to $0.95-$1.04 in the coming weeks.
