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 Benefiting from broader market trends is difficult.
VeChain’s intraday drop of almost 1% may have reduced the chance of VeChain forming a bullish trend, and a significant 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 around 1.32% per week, which limits gains for the month to below 3%.
While the price chart still shows a possible inverse head and shoulders pattern, it is clear that there’s a downward trend. The neckline is aligned with horizontal resistance of $0.03307 but recent pullbacks increase the likelihood that the pattern will fail.
If the price is trading below the Fibonacci 23.60% level, then a daily close that triggers a significant correction could be imminent. Daily RSI dropped below midpoint which supports the negative outlook.
VeChain’s immediate support is the trendline descending, located near the Supertrend Indicator at $0.02572. If this price level is breached, then the trend might reverse towards the next levels of support at $0.02199 and $0.02471.
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 possible test of the neckline at $0.0307.
A breakout of the pattern may face immediate resistance near the Fibonacci 50% level, which is $0.03922. This could extend the bullish trend.
Derivatives Data Reveal Optimistic Bulls Facing Rising Liquidations
VeChain prices are falling, and derivative market liquidations have increased, wiping off bullish positions. In the last 24 hours long liquidations totaled 81,59K dollars, while short liquidations were only $4.05K.
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. The long-to short ratio has increased to 1.08 in the past 24 hours. This reflects a more even market.
VeChain is at a crucial juncture, with mixed signals coming from the derivatives markets and price levels that are being tested.
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Source: thecryptobasic.com
