Monero (XMR), the privacy-focused cryptocurrency, has recently captured the attention of investors and market analysts alike after its price touched a 34-month high on January 17.
But what does the future hold for XMR? Let’s delve into the recent developments, technical indicators, and market dynamics to forecast the potential trajectory of Monero’s price.
Monero price is currently in a consolidation phase
After reaching its 34-month peak, Monero’s price has entered a phase of consolidation, a common occurrence after significant rallies.
This period of stabilization suggests that the market is in a state of flux, with investors and traders weighing their next moves.
Over the past week, the price of Monero has been oscillating between $209 and $227, which indicates a market in search of a new equilibrium post the high.
On January 17, immediately after Monero’s price hit the 34-month high, the Relative Strength Index (RSI) entered the overbought territory, suggesting that the asset was potentially overvalued or due for a correction.
Following this, the RSI corrected to around the neutral level of 50, indicating that the intense selling correction pressure had subsided, and the market was finding balance.
Monero price: Breakout from an ascending triangle imminent
More intriguing is the formation of an ascending triangle on the daily price chart. This pattern, characterized by a flat resistance line and an upward-sloping support line, hints at a bullish scenario.
Monero price chart by TradingView
The price action within this triangle shows that while sellers are maintaining a consistent resistance level, buyers are progressively becoming more aggressive, pushing the price higher with each bounce.
Analysts often view such patterns as precursors to breakouts, with the direction of the breakout holding significant implications for future price movements.
Currently, Monero trades at $221.34, with a 24-hour performance showing a slight increase of 3.6%.
This modest uptick, alongside a trading volume of $57,900,877, suggests that while the market has cooled from the frenzy of the peak, there remains considerable interest in Monero.
The market cap stands at $4,089,591,702, with both circulating and total supply at 18,446,744 XMR, indicating a stable supply scenario.
The bullish potential hinted at by the ascending triangle is further supported by the historical performance metrics.
From the all-time low of $0.2162 to a high of $542.33, XMR has shown a capacity for significant price movements.
If the price breaks above the resistance at around $227, it could signal the start of another bullish phase, potentially pushing the price higher in line with the expectations set by the pattern.
Such a move would validate the bullish sentiment among investors, possibly leading to a surge in buying interest.
However, investors should remain vigilant. The current consolidation phase post-peak demonstrates the market’s cautious optimism, balancing between the euphoria of a high and the reality of potential corrections.
Also, a false breakout or a breakdown below the ascending support could reverse these expectations, leading to a bearish outlook.
The broader market context, including regulatory news affecting privacy coins, technological advancements, or shifts in investor sentiment towards cryptocurrencies, will play crucial roles in determining Monero’s price direction.
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