Technical analysis:
1. Exponential Moving Averages (EMA):
• The three averages (7, 25, 99 days) show a bearish bias in prices, as the EMA (7) is clearly falling below the longer averages (25 and 99), which reinforces the bearish scenario in the short to medium term.
2. Relative Strength Index (RSI):
• The 6-day RSI is 28.31, indicating that the asset is in the overbought zone, and there may be a chance for an upward bounce soon if the buying pressure continues.
• The 24-day RSI is 44.81, which means the market is still in the neutral zone, but beware of the continued downward momentum.
3. MACD Indicator:
• MACD is showing a bearish crossover where DIF is below DEA by around -111.40. MACD value at -146.97 confirms that the downward momentum is continuing, which indicates the possibility of a continuation of the decline in the near term.
4. STOCHRSI:
• The Stochastic RSI indicator is showing a very low value at 4.80, which indicates that the asset is in a very oversold zone. This may indicate a possible price reversal soon.
Recommendations:
• Short-term: Since the RSI and Stochastic RSI are indicating oversold, there is a strong possibility of an upward bounce soon. Investors can consider opening short positions if strong reversal signals appear.
• Support and resistance levels:
• Major support is at $2,300-$2,349. If broken, we may see further decline to lower levels like $2,200.
• The next resistance is at $3,230. If the price bounces up and this level is broken, there could be a rally towards higher levels.
• Professional trading: It is preferable to follow positive signals on momentum indicators such as MACD and RSI, and wait until the market shows strong reversal signs before entering into large trades.
• Risk Management: It is better to place Stop Loss orders below the key support level at $2,300 in case the decline continues.
