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- Monero has seen its bullish structure reverse dramatically.
- A rise above $115 could give short-term traders hope for sustained profits, but it may not last.
Monero (XMR) saw a bullish market structure in the first week of February. During trading on February 6, XMR experienced a loss of 39.8% in one day.
AMBCrypto investigated the cause of this crash in a previous report.
At press time, the price was well below the $130 level, which has served as support throughout 2023.
Holders have been extremely negative over the past few days, with futures markets also favoring sellers.
Where to shorten and invalidate XMR
Monero showed a bearish market structure for one day following price fluctuations on February 6th. It fell nearly 40% before bouncing back 31% the very next day.
However, if the price surges to $135, it could be a retest of the previous demand zone.
Source: XMR/USDT on TradingView
RSI was at 36, reflecting strong bearish momentum. OBV, which had been trending upward until December 2023, has started forming a range over the past two months. This showed buyer fatigue.
A break below the local OBV support could lead to a downtrend on the price chart.
The $136 and $144 levels represent key Fibonacci retracement levels. Therefore, they are expected to act as strong resistance.
However, if XMR can break above the $156 level, any thoughts of a downtrend will be nullified.
Meanwhile, in the current situation, there is still a possibility of a revisit to the sub-$100 level. XMR holders may give up and sell more of their assets if the price continues to fall.
Futures markets highlight strong bearish sentiment.
The price decline on the 6th was accompanied by a huge increase in USD open interest per exchange. This meant that futures market participants were willing to sell XMR.
Source: Santiment
The sharp drop in funding rates also indicates that the XMR market is heavily biased in favor of the bears.
Read Monero (XMR) Price Prediction for 2024-25
Weighted Sentiment has fallen to levels not seen in over a year and was slightly positive at press time.
A combination of indicators and price action suggests that Monero is more likely to see a downtrend than an uptrend in the coming weeks.
Disclaimer: The information presented does not constitute financial, investment, trading, or any other type of advice and is solely the opinion of the author.