Connect with us

Analysis

IOTA: Assessing if higher timeframe bears could be defeated in June

Published

on

IOTA approaches resistance and new lows could be set in the weeks to come
Source: Pixabay

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.

IOTA has been in a steady downtrend on the price charts since September 2021. The time period from October to December saw the price form a range, but the range lows were tested multiple times in December, and broken in January.

In the past few days, IOTA has seen a move upward, but it was beneath the $0.37 resistance which it was rebuffed from in May. Now, the most pertinent question is- Can the bulls force their way through in June?

IOTA- 1 Day Chart

IOTA approaches resistance and new lows could be set in the weeks to come

Source: IOTA/USDT on TradingView

The $0.95-$1 resistance zone was retested as resistance in the late March rally. Bitcoin had a good rally from late January to early April, when BTC rose from the $34k area to the $47.2k mark. However, IOTA formed lower highs on the daily chart in the same time period. This showed that the IOTA had strong bears.

At the time of writing, the price approached the $0.37 resistance again, an area where it had formed a bearish engulfing candle in mid-May. It appeared likely that another test of the $0.37-$0.4 area would meet with rejection, and could set IOTA on a move southward to the $0.24 support.

Rationale

IOTA approaches resistance and new lows could be set in the weeks to come

Source: IOTA/USDT on TradingView

The RSI on the daily chart was beneath neutral 50, and has been since April. This highlighted the strong bearish trend behind IOTA over the past two months. However, the RSI has been forming higher lows and climbing toward the neutral 50 line.

The Awesome Oscillator was also beneath the zero line, but has formed green bars on its histogram over the past three weeks to denote weakening bearish momentum. As things stand, this move toward $0.37 appears to be a pullback in a downtrend, than a shift in momentum toward the bulls.

The CMF rose above +0.05, which meant significant buying pressure was seen. However, the OBV has been unable to climb past the May highs, which meant the buying volume was not particularly strong.

Conclusion

The market structure remained bearish, and the $0.37-$0.4 was a strong resistance zone. The indicators showed only a pullback in motion and not a trend reversal. Hence, the $0.37 area can be a selling opportunity.

Buyers would want to wait for the $0.4 level to be retested as support before punting a buy targeting the $0.48 resistance as take profit.

Read the best crypto stories of the day in less than 5 minutes

Subscribe to get it daily in your inbox.


Please select your Email Preferences.

Akashnath is a Chemical Engineering graduate deeply fascinated by Technical Analysis and the crypto markets and enjoys studying price movements and trying to find patterns.

Click to comment

Leave a Reply

Your email address will not be published.

Disclaimer: AMBCrypto's content is meant to be informational in nature and should not be interpreted as investment advice. Trading, buying or selling cryptocurrencies should be considered a high-risk investment and every reader is advised to do their own research before making any decisions.