On March 14, Golem (GLM) price bounced to $0.31. This happened days after the Golem Network token experienced a correction that drove it down to $0.25.
However, the cryptocurrency seems unable to sustain that momentum. At press time, GLM had retraced to $0.28.
Technical indicators have pointed to weakening bullish momentum, and on-chain metrics support the outlook. Here is how GLM’s price might fare in the days to come.
GLM Forms Bullish Divergence
According to Santiment, Golem’s price Daily Active Addresses (DAA) divergence was positive from March 9 to 16. However, as of this writing, the adjusted price DAA divergence has plunged to -47.39%.
The divergence threshold defines the point at which the difference between the DAA and price becomes significant enough to trigger a buy or sell signal.
When the metric’s reading is positive, it implies that user interaction with the token is increasing, which is a buy signal.
Conversely, a negative price DAA divergence reading indicates that user interaction has decreased, indicating low user engagement. Therefore, the decline in the price DAA divergence signifies a sell signal.
If sustained, this could halt GLM’s price from trading higher than $0.28.
Besides this signal, GLM’s technical outlook shows that the token’s short-term potential could be bearish.
One indicator that aligns with this thesis is Bull-Bear Power (BBP). The BBP measures the strength of bulls against bears.
When the reading is positive, it means that bulls (buyers) have the upper hand. In this instance, the price is likely to increase. However, the BBP is negative for Golem’s price, indicating that bears (sellers) are dominant.
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Thus, if this trend continues, GLM’s price might experience a downturn.
GLM Price Risks Extended Decline
Zooming into the GLM/USD daily chart, CCN observes that the Relative Strength Index (RSI) has dropped below the zero signal line. The RSI measures momentum by measuring the speed and size of price changes.
When the reading is above the midpoint, momentum is bullish. However, in this case, the RSI position indicates that the momentum around the Golem token is bearish.
Therefore, if the rating fails to break above the indicator’s midpoint, the value might fail to breach the $0.32 resistance positioned at the 0.236 Fibonacci level.
If this is the case, Golem’s price might decline to $0.21. On the contrary, if GLM breaches the $0.32 obstacle, this prediction might not pass.
Instead, the token’s value might rise to $0.39 in the short term. In the long run, GLM could experience a rally toward $0.49.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
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