Decentraland (MANA) token price increased by 150% over the past two weeks and made a bullish breakout of the 406-day resistance line
The Decentraland platform is one of the most popular metaverses built on the Ethereum blockchain.. Its native coin is an ERC-20 MANA token. In Decentraland, users can buy and sell virtual lands, explore the Decentraland virtual world map, go to events, and even play casinos.
As the results of the technical analysis show, the MANA rate hit an all-time high of $5.90 in November 2021, but has since been falling along a descending resistance line.. In December 2022, the price hit a low of $0.28.
After that, the market bounced back, testing the $0.30 horizontal support area for strength.. This was a very important event as the $0.30 area also represented a Fibonacci support level.. Accordingly, its bearish break could accelerate the pace of decline.
After the rebound, the MANA price increased by 150%. Last week, the price broke through the long-term descending resistance line and the $0.51 horizontal area, which can now act as support.. In addition, the weekly RSI is currently moving above the 50 mark.
If he succeeds, the token could rush to the next resistance at $1.10 (average price). On the other hand, a weekly close below $0.51 could mean that the MANA trend remains bearish.
Source: TradingView MANA can't take the barrier
On the shorter daily chart, you can see that Decentraland is unable to break above the $0.71 resistance area.. The price briefly looked above it, but formed a long upper wick (red icon), which is considered a signal of bearish pressure.
In addition, the daily RSI is in the extreme overbought zone, although it is not giving any bearish divergence signals yet.
If the bounce is confirmed, the most likely scenario for the coin will be a fall towards the $0.51 long-term support area mentioned above.. A recovery above this mark should see Decentraland bullish this month.
Source: TradingView Pullback first, then breakout
Wave analysis results warn of possible Decentraland correction. The price is probably in the fifth and final wave of the bullish structure launched on January 1. If this is true, then the fifth wave is extended, its length is 2.61 times the combined length of waves 1 and 3 (black).
The 6-hour RSI, meanwhile, is signaling a bearish divergence (green line), confirming the wave analysis results and the price rebounding from the $0.71 area.
If MANA starts declining, immediate support will meet the coin at $0.58 and $0.52. These are the Fibo levels of 0.382 and 0.5 corrections, respectively.
Source: Trading View
Thus, the most likely scenario is a price rollback after the growth that began in January. Immediate support passes at $0.58 and $0.52. Closing the week above $0.71 will cancel the short-term bearish forecast for MANA.
Earlier, the editors of BeInCrypto said that Bitcoin (BTC) took important technical milestones, but became overbought.
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