VeChain is now below the support level of $0.027, putting the bullish head-and shoulders pattern at risk.
Will there be a reversal of the current trend, or is it a more serious breakdown? Altcoins are gaining momentum after Ethereum moved above $2700. VeChain The market is not able to take advantage of the wider tailwinds.
VeChain could fail to develop a bullish chart pattern with an intraday decline of about 1%. This would reduce the likelihood of a large recovery.
VeChain Price Analysis
VeChain, on the daily chart has dropped below the Fibonacci Retracement Level of 23.60% at $0.02729. This represents a decline in value of approximately 1.32 % per week, which limits gains for the month to below 3%.
The price pattern still indicates a possible head-and shoulders inverse pattern. The neckline lines up with the horizontal support at $0.03307; however, the recent pullback raises the possibility of the pattern failing.
A daily closing below this Fibonacci support level could lead to a long-lasting correction. Daily RSI dropped below the middle point, indicating a loss of significant bullish momentum. This supports the negative outlook.
VeChain has immediate support at the Supertrend indicator, near the descending trendline at $0.02572. If this price level is breached, then the trend might reverse towards the next levels of support at $0.02471 or $0.02199.
A potential bounce within the falling channel would revive bullish expectations and raise the probability of completing an inverse head-and shoulders pattern. This could include a retest near the neckline of $0.0307.
A breakout of the pattern may face immediate resistance near the Fibonacci 50% level, which is $0.03922, and could extend the bullish rally.
Derivatives Data Reveal Optimistic Bulls Facing Rising Liquidations
VeChain’s falling price has accelerated the liquidation of derivatives positions, erasing bullish trades. In the last 24 hours long liquidations amounted to $81,59K compared with just $4.05K for short liquidations.
VeChain’s open interest, however, has increased by 1.09% and now stands at $79.71 Million. The funding rate also increased to 0.0112%. This indicates a growing bullish attitude amid the increase in trading activity. In the last day, the ratio of longs to shorts has been pushed up from 1.008 to 1.008. This indicates a more equilibrated market.
VeChain finds itself at a crossroads due to the mixed signals of the derivatives marketplace and the testing of key prices levels.
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Source: thecryptobasic.com
