As we enter the month of September which is historically the worst performing month for risky asset classes, cryptocurrencies have been cruelly marking time since the second half of August. Indeed, the FED’s and ECB’s desire to intensify their monetary tightening could last longer than expected. This message sent to investors would encourage caution in the months to come.
For example, XMR, the Monero blockchain token, has seen its technical rebound since mid-June hit a wall. Especially since the latest technical analyzes are hardly encouraging. Which would eventually revive the hypothesis of a new bearish sequence similar to what has happened since its last ATH in May 2021.
Monero – Failing below the 30 week moving average
Monero prices have settled in a declining channel since August 2021. With highs and lows that become lower and lower. And despite an impressive rebound from the $109 support, they just failed below the 30 week moving average (MM30 weekly) without even coming back into contact with the resistance of $194.
At the same time, the technical indicators move away from their respective fold lines. But much to the chagrin of cryptocurrency investors, it is clear that Weinstein’s phase 4 is reinforced. This also coincides with prices struggling to get back to the upper part of the bullish channel. In any case, a nice shooting window opens for sellers.
Assuming these unfavorable technical signals hold, XMR prices are likely to head down its downtrend channel. With the fear that new lows for the year would materialize if the support at $109 were to break. In which case, the recovery of its bear market since its last ATH in May 2021 would be in motion again.
Monero – Failing below the 200-day moving average
Clearly, moving averages do not bring luck to Monero. Because precisely, prices failed twice below the 200-day moving average (MM200 daily) during the summer. Unfortunately, this resulted in the MACD and RSI sliding below the zero line and neutral zone at 50 respectively.
Even though XMR prices are trying to break through the middle line of the downtrend channel with the complicity of technical indicators, positive catalysts are missing due to a complex market environment for many investors to unravel. However, in the event of a second wind of the technical rebound, the resistance of $194 and the top of the bullish channel would be again in play.
Conversely, we resume the scenario mentioned on the weekly chart. Breaking the support at 109 would lead us towards the support at $77. Which would practically destroy the last bullrun. Not to mention that a return to square one towards the low points of 2020 should not be excluded, and would lead to a total capitulation of buyers.
XMR – A reflection of a lack of trust in cryptocurrencies
The graphical evolution of Monero prices since its last ATH in May 2021 reflects a stalemate in the cryptocurrency bear cycle, but also a lack of confidence in this risky asset class. Not only the latest scandals against them do not help to restore their image. But the lack of regulation in relation to traditional assets could delay the arrival of institutional flows.
To make matters worse, the rise in US bond rates and a strong dollar are headwinds to a return to risk appetite. This would presage a jump in volatility towards levels consistent with current uncertainties in the financial markets. And to the extent that the latter would not subside, the capitulation on cryptocurrencies would not be long in coming. What bring the ultimate thrust that the industry would need to start again on a sound basis.
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Monero (XMR) Analysis – New bearish sequence in sight? – CryptoNews
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