EOS price is currently trading at $1.21 after flipping the 200-day Exponential Moving Average into support this week.
The altcoin needs to breach the resistance at $1.32 in order to mark a six-month high.
Unexpected selling could bring the price back down below $1.16, invalidating the bullish thesis.
EOS price has been performing better than expected for the last three weeks, preparing to reclaim the losses it witnessed in early March. While all hands point toward a potential price rise, traders need to watch out for signs of the market overheating.
EOS price set for a rally
EOS price, trading at $1.21, is nearing immediate resistance at $1.25. Up by 23% in the last three weeks, the altcoin has managed to flip the 50, 100 and 200-day Exponential Moving Averages (EMAs) into support. Nearing a 2023 high of $1.32, EOS needs to sustain an 8% rally going forward.
The Relative Strength Index (RSI) is in the bullish zone above the neutral line at 50.0 and rising. This is a positive sign for EOS price as the altcoin still has some steam to chart more gains over the next few trading sessions.
Support from the bulls would be crucial in driving a rally, flipping the resistance at $1.25 into support and breaching the $1.32 barrier.
A rise above the same would not only mark a new year-to-date high for the cryptocurrency but also place the EOS price at a six-month high. The last time the token managed to touch this price level was back in September 2022.
But if the markets overheat by the time EOS reaches $1.32 and RSI climbs into the overbought zone above 70.0, corrections could be on the way. Some minor selling at the same time would also cause a similar reaction, and EOS could decline to $1.16. This critical support level marks the confluence between the 200-day EMA and the 50% Fibonacci retracement level of the $1.32 to $1.00 drawdown.
Losing the same would invalidate the bullish thesis and trigger a fall to $1.07 or lead to EOS price slipping below $1 towards the March lows.