EOS Technical Analysis #006 – EOS sees price increases despite RAM supply issue

EOS Technical Analysis #006 - EOS sees price increases despite RAM supply issue

Eos has enjoyed a strong start to the month of July, experiencing a price increase of 12.44% over the past 7 trading days. Eos is currently trading hands at a price of $8.74 and has witnessed a 5.28% price increase over the past 24 hours alone.
This price increase comes despite turbulent times for EOS. Eos has recently launched its mainnet blockchain and has been plagued with bugs, blockchain pauses, centralisation fears and now RAM issues.
Eos was intended to become a network that allows for free transactions, however, with RAM prices soaring, speculators are questioning how transactions can be free. During the past 7 days RAM prices have increased 600% from 0.11 EOS to around 0.7 EOS per KB of RAM. The RAM is used by developers for dapp development but how can developers begin to develop if the RAM is already so expensive?
Users also need around 4kb of RAM to create an account upon the Eos network, this now costs between $20-$30. There have also been more recent problems when a block producer had crashed after RAM usage had exceeded 1GB.
Eos is currently ranked 5th in terms of overall market cap across the entire industry with a total value of $8 billion. Eos has experienced a price drop of over 36% throughout the past 30 trading days, so the market still has significant losses to recover.
Let us continue to analyse how the market has been trading over the recent term.

Price Analysis

EOS Technical Analysis #006 - EOS sees price increases despite RAM supply issue.
Analysing the market from the short term perspective above, we can see that Eos had experienced a significant bullish run starting from a low of $3.87 on the 18th of March, running all the way up to the markets all time high at $23.02, played on the 29th of April. This was a price increase of 480% from low to high.
Since placing this all time high price action went on to depreciate, firstly finding support at the .618 Fibonacci Retracement priced at $11.17 during May. This is a Fibonacci Retracement taken from the bullish run highlighted above.
The market went on slip during June, falling through the .618 Fibonacci Retracement and the major $10 handle, until it found support just below the .786 FIbonacci Retracement priced at $7.97 toward the end of the month. It is important to highlight that price action had found significant support at the $7.58 level, which is the yearly opening price. We can see that price action had also found support at the 1.618 Fibonacci Extension level priced at $6.92. This is a Fibonacci Extension taken from the bearish swing leg experienced exclusively during the month of May.
We can see that the market has currently found strong support at the 1.414 Fibonacci Extension level priced at $8.54. If the momentum experienced during the first week of this month can continue, the bulls may be able to push price action back toward the $10 handle. Resistance located above the $10 handle can be found at the .618 Fibonacci Retracement priced at $11.17. Further resistance can be located at June’s monthly high priced at $15.54, which is bolstered by resistance at the .382 Fibonacci Retracement.
Alternatively, if the bullish action subsides and the market rolls over, initial support can be located at the yearly opening price of $7.58. Support located below this level can be found at $6.07 which is the .886 Fibonacci Retracement.
The RSI indicators is currently involved in a battle with the 50 handle. If it could break above the 50 handle, this would indicate that the bullish momentum is in control and is consistently building.
With all the attention surrounding the centralisation from the block producers and issues surrounding RAM supply there is no doubt that Eos will experience some significant increases in volume over the next few months.
Amongst all this negativity, the Eos community manages to hold strong indicated by the dulled price drop relative to other cryptocurrencies in the same period. We will be closely following updates from the Eos team regarding the governance overhaul and RAM solutions.