EOS Technical Analysis #002 – EOS Breaks Above The .50 Fibonacci Level Against USD

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EOS Technical Analysis #002 - EOS Breaks Above The .50 Fibonacci Level Against USD
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The opening few trading sessions for the month of June have started with some bullish momentum for the crypto giant, EOS, as price has reached a high of $15.54 on June 2nd. This a significant 50% gain from the lows in May at a price level $10.33. As of today, EOS has rebounded slightly and is currently exchanging hands at a price of $13.56.
This price increase can be attributed to the development company, Block.one, releasing the first version of their blockchain protocol, EOSIO, on June 2nd as a mainnet release. As indicated by the bullish momentum experienced at the time of the release, this mainnet was a much anticipated release for those that took part in the $4 billion token crowdsale, the largest in the history of crypto.
Even the potential security risks outlined by the security firm, Qihoo 360, could not deter the bulls from adding to their positions as the security risk was promptly identified and resolved by the EOS team.

Price Analysis Overview

EOS/USD – Long Term – Daily Chart
https://www.tradingview.com/x/uioENDby/

From a long term perspective, the market has made a promising start to the month of June. Analysing the chart above, during the month of May, we can see that EOS had retraced up to the 3 month old .618 Fibonacci Retracement level, at price $11.17. Since then, price action has managed to hold above this fibonacci level and has continued to break above the .50 Fibonacci Retracement level at a price of $13.42.
Price action then went on to test the .382 Fibonacci Retracement, at price $15.68 but was promptly rejected by this level. This price zone also correlates with the high-day close candles set out in early January.
If the price of EOS can hold above the .50 Fibonacci Level then we could expect the market to continue to make gains during the month of June. A break above $15.68 would allow for the markets to go on to retest the previous all time high set in April at a price of $23.02.
Alternatively, if price falls and close below $13.42 then we could expect price to return to previous near term support at the .618 Fibonacci Retracement at a price of $11.17.
The technical indicators are showing positive signs for any bulls within the market. Although it is not so clear on the chart just yet, the 7-day EMA has crossed above the 21-day EMA indicating the possible reversal occurring currently within the market. If price action can stay above the 21-day moving average then we may see some continued positive momentum over the next few trading days.
The RSI has also managed to break its way above the 50 handle indicating the positive bullish momentum within the market. RSI is currently finding some near-term support just above 50. We will closely monitor RSI over the coming trading sessions to see if it can hold this pivotal level.
We will be closely following the updates from the development team for any potential bugs found as the mainnet launch grows over the next few weeks.
EOS/USD – Short Term – 4-hr Chart
https://www.tradingview.com/x/sLuEyVl9/

Analysing price in the short term, we can see that price has retraced slightly after the significant bullish swing seen at the start of the month.
Over the past 12 hours, price action has fallen from its near term highs and has recently broken below the .382 Fibonacci Retracement at price $13.47. This Fibonacci level is taken from the swing low seen toward the end of last month up until the recent high seen at the start of this month. It also coincides with the long term .50 Fibonacci adding to the support validity expected in this area.
If price fails to hold at $13.47 then we could see the retracement continue further up until the short term .618 Fibonacci Retracement at a price of $12.28 before finding some significant support.
Alternatively, if price action manages to stay above $13.47 then we may see the bullish momentum initiated from the mainnet release to continue. In this scenario price would have to break above the recent highs at price $15.64 and continue to make long term significant gains.

Conclusion

Price action has made a promising start to the month of June. The mainnet launch has introduced some new bullish momentum within the market. It will be important to monitor any upcoming news from the development team as any major bugs found within the mainnet may lead to significant price decrease.
On the other hand, if updates from the team remain positive and development continues then the month of June may hold some significant gains for EOS against the USD.


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The views expressed in the article are wholly those of the author and do not represent those of, nor should they be attributed to, ZyCrypto. This article is not meant to give financial advice. Please carry out your own research before investing in any of the various cryptocurrencies available.