Do or Die Time for Steem Price?
I don't have enough time to do an in-depth technical-analysis (TA) look on Steem, nor a formal write up on it to break down all the details, but, having noticed that price is currently testing a rather important TA-level, one that can lead to a very bearish move if it's broken, I decided to throw together a quick chart highlighting the issue along with a brief explanation of what it might mean for the short-term future price of Steem. Below is an 8-hour chart of STEEM/ BTC from the Poloniex exchange:
Source: https://www.tradingview.com/x/zAe5QODA/
Brief Explanation of the Chart and Possible Indications:
The yellow box highlights a support zone, a level between which price has had several instances of creating pivots out of previous trends (bottoms to downtrends and tops to uptrends). I put in two black arrows highlighting two instances of the bottom portion of the support zone acting as a pivot to the previous downtrends.
We can see that once price finally breached the lower part of that zone (near mid February) that a quick and quite nasty downtrend ensued. There are probably many reasons why that happened, but one of them (from the TA perspective) is that closing below the lowest of all the major pivots (black arrows) is a clear signal that all historical bid (buyer support) levels have been wiped out. At that point, there was no knowing if or where buyers would come back in, which created fear and led to sellers lining up to dump their Steem as quickly as possible.
Now, Steem is yet again sitting at that major pivot level (the leftmost black arrow). Should price close below that level, we may see the same panic sell, perhaps all the way down to the previous lows, highlighted on the chart by a dashed green line.
There are a few buyer (support) levels between the support zone and the previous lows; however, closing below the support zone takes Steem out of "uptrend status" for me and I know that many traders would agree with me on this view, which will likely translate into a great portion of the market not wanting to touch Steem with a 10 foot pole UNTIL price reaches at least the previous lows. In other words, it's not a good sign if price closes below its current level...that is, unless you want another chance at super cheap Steem.
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So what you are saying is basically that we approach another down ride ?
It's possible. If one of those candles closes below the support zone (yellow rectangle), then there's a good chance that Steem goes back to the lowest prices that it has reached. That said, nothing is a sure bet.
You're most welcome... I feel good!