Key Takeaways
- After reaching a yearly high in late May, the Monero coin price has dropped to $308.
- The daily chart shows a falling wedge, but a breakout requires reclaiming $337.91 resistance.
- On the 4-hour chart, XMR fell below the $311.94 level, weakening the expected bullish reversal.
During May’s last days, Monero’s (XMR) price rallied past $400 and reached a new yearly high. This development sparked calls for a run toward the $500 psychological mark.
However, June came, and XMR’s price failed to achieve that. Instead, the cryptocurrency dropped by nearly 20% and is on the verge of falling below $300.
However, the technical setup simultaneously shows that it has formed a bullish pattern. Other indicators reveal that it could take some time before the breakout above this pattern is validated.
XMR Yet to Break Out Again
Between May 27 and this writing, XMR’s price has fallen from $402 to $308. This decline led the altcoin’s value to hit lower highs and lower lows.
Due to this decline, XMR’s price formed a falling wedge, a bullish reversal pattern. To validate the wedge formation, the Monero coin has to break above the upper trendline and resistance at $337.91.
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It also has to hold the support at $299.28. However, the market value is closer to the support than the resistance at press time.
This indicates that buying pressure is fading, and XMR might have to wait a while before it breaks out. In supporting this thesis, the Chaikin Money Flow (CMF) has yet to rise above the zero signal line.
This indicates a bearish divergence when compared to the pattern formed on the daily chart. Should this remain the same, XMR’s price risks falling below $300 and is unlikely to see a quick surge above $400 like it did in May.
XMR Price Prediction: Sideways Movement
On the 4-hour chart, XMR’s price also presents a bearish outlook. From the chart below, the altcoin has formed an inverse head and shoulders pattern.
Like the falling wedge, this is supposed to drive a bullish reversal. However, a closer look at the chart shows that XMR has dropped below the neckline at $311.94.
Therefore, it is not time to break above the upper resistance levels and hit higher prices. The Relative Strength Index (RSI) is another indicator that supports this thesis.
As of this writing, the RSI has dropped below the neutral line, indicating bearish momentum. The Accumulation/Distribution (A/D) line has also remained flat, indicating a lack of trading activity around XMR.
Should this trend continue, XMR’s price risks falling to $278.55. However, a surge in buying pressure could invalidate this bias.
If demand for the coin increases and bulls intensify accumulation, XMR’s price could rally to $389.77. If the market conditions improve, it could tap a new yearly high of $420.
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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