The Waves (WAVES) price is trading at a crucial resistance level, a breakout above which would go a long way in supporting the possibility of a bullish trend.

However, technical indicators are neutral, and the wave count suggests that the price is more likely to decline in the short-term.

The WAVES price has been moving downwards since it reached a high of $5.02 on Aug 17. The decline continued until a low of $2.07 was reached on Sept 21, and the current bounce began.

Currently, we can say that WAVES is trading in a range between $2.15 and $3.90, currently sitting in the middle of the range at $3.05.

While the price moved above this level on Oct 17, it created a long upper wick and then fell. The fact that the price has not yet reached the 0.5 Fib level of the entire fall makes it likely that the current movement is corrective.

Cryptocurrency trader @altcoinsherpa outlined a Waves price chart, stating that while the price action looks bullish, the $3.05 area holds immense importance for the future trend’s direction.

Since the area represents the middle of the range, whether the price trades above or below is crucial in determining the future trend. Currently, the price is trading inside this area and has not yet confirmed it as either support or resistance.

The importance of this level is also accentuated by the weekly time-frame, which shows that it acted as resistance between Feb and Apr 2019.

Technical indicators on the daily time-frame are bullish. Both the RSI and the Stochastic Oscillator are increasing, the latter having made a bullish cross. Furthermore, the MACD has crossed into positive territory. The previous time this occurred, a very significant upward move followed.

Therefore, these readings suggest that WAVES should rally towards the next resistance area at $3.90.

However, shorter-term technical indicators are bearish. Both the RSI and the MACD have formed bearish divergence and are falling.

Therefore, a drop towards the closest support area at $2.72 is likely (also 0.5 Fib level) before the price possibly resumes its upward move.

Since the previous Sept 21 low, the WAVES price seems to have completed an A-B-C corrective structure (shown in orange below). The structure gains more validity since the A:C wave ratio is 1:1.61 (common), and five subdivisions are clear (red) inside the C wave.

If correct, what should follow is a price decline, fitting with the readings from short-term technical indicators.

Therefore, WAVES is expected to fall towards $2.75 in the short-term. If the price manages to bounce at that level, it will allow for the possibility of another breakout attempt. However, until the price successfully breaks out above $3.05 and confirms the area as support, we cannot consider the trend bullish.

To conclude, the WAVES price is likely to fall towards $2.75.

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Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto.

The post WAVES Rallies Considerably but Gets Rejected Near $3 appeared first on BeInCrypto.

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