Monero traders eye $513 liquidity sweep as XMR’s price faces over-leveraged derivatives
Swing traders can first wait for a sweep of key lows such as $513-$520.
Popular privacy tokens have recorded diverging performance over the past 24 hours. Monero [XMR] fell by 5.1%, while Zcash [ZEC] was up by 9.8% at the time of writing, compared to Bitcoin’s [BTC] 0.9% gains.
In fact, the world’s leading crypto saw a price jump to $83.4K at the start of the New York session on Tuesday, 20th October. At the same time, Monero’s price bounced by 3.2% from $607 to $627.
Why is Monero down today?
On-chain investigator ZachXBT reported that 87% of the inflows to the non-custodial crypto exchange and swap service, FreedomXMR (FXMR), were illicit. Labelled a centralized laundering service, the investigator found that the swap service deployed on Hyperliquid Core was directly linked to illicit activity.
A review of historical transactions exceeding $10,000 per transaction traced more than $20 million to ransomware, social engineering attacks, and exploits. According to ZachXBT, the admin likely sources Monero liquidity from KuCoin and has over 3,000+ deposits to the exchange.
When XMR prices climbed past $600 at the start of the week, some analysts warned that the Open Interest had built up to dangerously high levels. A record-high derivatives interest meant an over-leveraged market that could lead to a liquidation cascade.
The price structure on the 1-day timeframe seemed to be bullish. The next support levels to watch would be $484 and $438.
If psychological $600-support gives way, can it catalyze further losses?
The 4-hour swing structure was bullish at press time. The large candle and wick seen on 21st September presented a supply zone overhead that XMR rallied into in recent days and has faced rejection from.
Another retracement towards $560 and $520 may be likely. To negate the bullish structure on this timeframe, Monero’s price would need to close a 4-hour trading session below $484.29, the low that anchors the uptrend.
Swing traders can wait for a sweep of key lows, such as $513-$520, before looking for buying opportunities.
Final Summary
- Monero’s price structure remained bullish across timeframes despite the pullback from $627 to $576.
- A price drop towards $513 could offer a buying opportunity, but an extended decline below $484 would flip the structure bearishly.
