Hi friends hope you are doing well and welcome to the new update on Neo coin. As the Neo coin has broken down the support of an up channel that was formed on the daily chart same as like the Bitcoin has broken down the channel. In today’s post we will try to understand now what can be happened next whether the price action will move up or move down.
Breaking down the channel and a golden cross:
As we have already discussed that the priceline of Neo coin has broken down the support of the channel. The formation of this channel was started after the mid of March 2020. On 7th June a golden cross between 50 simple moving average and 200 SMA.
This golden cross produced a powerful rally that led the price action up to the resistance of the channel. However after making a powerful attempt to break out the resistance the priceline moved back to hit the support of the channel and finally it has broken it down. At this time the price action is breaking down the 50 simple moving average once this moving average will be broken down then Neo can hit the 200 SMA. The golden cross formation is below the price action therefore unless this golden cross will be not changed to the death cross there will be a hope for the bullish reversal of price action.
Support and resistance levels:
Now if you watch the different support and resistance levels on 2 day chart then it can be observed that after mid of march the price action turned bullish and produced more than 125% rally. And reached at $13 resistance. That is really very strong resistance as it is not broken out since after July 2019. Once the price action broke out this level. But while retesting this resistance as support it was failed. At that time all the markets were moving down. And the Neo coin also moved down with other markets as well. After hitting the last support at $6 it produced more than 125% rally and after breaking out every resistance level it has been retesting the every resistance as support. At this time after hitting the $13 resistance and being rejected it is again dropped at $10 support. If the price action will be not able to retain this support then it can move to the next support at $8.
Formation of bullish reversal pattern:
Even though the price action has broken down the support of up channel on the daily chart. But at the same time the Neo coin has formed a bullish reversal pattern and that is harmonic BAT. The price action has just spiked into the potential reversal zone. This PRZ starts from $10 up to $9.65. Now we can set our stop loss the maximum extent of this bullish BAT pattern’s PRZ level. Because if the potential reversal zone will be broken down then the priceline move more down to form a bullish Crab’s final leg.
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Ichimoku cloud:
Now at the end of this article I would like to share a very important move of Neo coin that can be appeared in near future. And that is the ichimoku cloud on the long-term weekly chart. As we can observe that the Neo coin never able to cross up this cloud and now it is continuously making several attempts to break out this cloud. After making the recent attempt it is moving down but we have still lagging span of the ichimoku cloud above the price action that is a bullish signal. And the conversion line is crossing up the baseline just below the price action. That is another bullish signal. Now if the price action will take a powerful bullish divergence from the potential reversal zone of BAT pattern that is formed on the daily chart. Then it might be helpful for the priceline to break out this cloud and once this cloud will be broken out then it will become a very strong support for the long term bullish rally.
Conclusion:
On weekly chart after hitting the ichimoku cloud the price action is moving down. And it has also broken down the up channel. And it has also formed a bullish reversal pattern. Therefore the unless the potential reversal zone of this BAT pattern will not be broken down we can hope for a powerful bullish reversal from here.