The Monero market fell hard on Tuesday to show further weakness. The $240 level continues to be an area of interest, as it was previous resistance. Now it is offering support, and it is worth noting that the Monday candlestick was a bit of a hammer. Now that we are testing the bottom of it, it looks like we could threaten a serious breakdown. Having said that, we also have just recently had the so-called “golden cross”, which is when the 50-day EMA crosses above the 200-day EMA.
The market could very well break down below the $240 level, which would not be a huge surprise considering that Monero is a minor coin. Furthermore, as long as Bitcoin and Ethereum struggle, it is difficult for smaller markets like this to have any real traction. I think at this point in time it is likely that we will continue to see a lot of noisy behavior, so you are going to have to be very cautious about your position sizing. I think given enough time we will probably have some type of resolution, but right now crypto does not look very good. With that in mind, I do not expect Monero to be any different than the others.
On the upside, the $280 level has been a bit of resistance, which is a significant resistance barrier going back multiple years. I think dips at this point could be supported at the $215 level, right along with the 50-day EMA and the 200-day EMA indicators that are sitting there. With this being the case, you need to wait to see whether or not we get a bit of a bounce in order to get involved again. I do not necessarily think you should short this market here, just that it does not necessarily look like it is going to take off all of the sudden either.
A bit of patience would have a lot to do with being successful in this scenario, which is something that you need to pay close attention to. Building a position slowly will probably work out best, as we continue to see a lot of volatility and fear not only in the Monero market, but pretty much anything that is further out on the risk spectrum.
