STABLE’s 52% price uptick is fading fast – THIS signal returns to range lows
The liquidation heatmap and the range formation suggested that the recent gains could slip from the bulls' grasp.
Stable [STABLE] witnessed a violent price swing on Thursday, the 23rd of April. Within a single day, the altcoin had rallied 52.8%, from $0.026 to $0.03975. The swift gains were not sustained.
On Friday, the prices, which briefly reached a local high of $0.0451, crashed by 31.6%. At the time of writing, it was trading at $0.319.
An earlier AMBCrypto report reasoned out why STABLE could be rallying. Increased stablecoin adoption in RWAs and traditional finance meant stablecoins were being pushed into everyday financial flows.
As a result, the Stable network was projected to see increased revenue due to the rising demand and the spike in gas fees, which could aid STABLE’s price action.
Despite the strong gains and sizeable pullback, traders need to be wary of the STABLE trend—or the lack thereof.
Looking at the STABLE rally within a range context
The range (purple) extended from $0.024 to $0.039, with the mid-range resistance at $0.0316. The $0.039 high, set in late February, has not been breached yet. That is, a daily session close above this local high has not yet occurred.
Combined with the swift rejection from the $0.04 supply zone, it appeared likely that STABLE prices would trend back toward the $0.024 range lows next.
The OBV was moving higher, but the trading volume has not been consistent. There have been low-volume days interspersed with high trading volume and high volatility days.
Hence, though the RSI reflected upward momentum, buyers should stay cautious.
Traders’ call to action: Prepare for consolidation
The 3-month liquidation heatmap showed a pattern. After hunting down the liquidity around $0.034 in late February, STABLE pushed a little higher before receding to the $0.022 magnetic zone.
On the way down, the consolidation in the first half of March built up short liquidation of $0.0315-$0.0345, which was once again hunted down in early April.
In summation, STABLE has a habit of volatile price moves toward key liquidity clusters, followed by a reversion toward the opposing magnetic zone.
At the time of writing, this opposing magnetic zone sat at $0.0245.
Traders can expect a downtrend toward this level, which lined up well with the range formation. On the way down, some consolidation and a bounce to sweep the overhead short liquidations is a possibility.
Final Summary
- Increased stablecoin adoption and more usage were likely factors behind the rising STABLE prices recently.
- The liquidation heatmap and the range formation suggested that the recent gains could slip from the bulls’ grasp.
