The price of WAVES has risen to a great historical degree of resilience, raising concerns about a death cross.
A significant rally in Wave propagation cost this week that saw it well almost twice risks weakening in the coming meetings due to a technical pattern known as a “death cross.”
After the ‘death cross’ in 2018, the price of WAVES plummeted by 85 percent.
When a stock’s long-term rolling average decides to close above its short-term rolling average, a fatality cross measure appears.
Notably, on the weekly chart of the WAVES, the 50-week exponential moving average (50-week EMA; the red wave) crossed above the 20-week EMA (20-week EMA; the green wave) in the week ending Feb. 21 — a bearish hybrid version.
WAVES hasn’t had a “death cross” on a daily chart since June 2018. In both cases, the WAVES market correction occurred as a result of a selloff in the wider cryptocurrency world following a major bull run.
After the 2018 death cross creation, WAVES fell by up to 85 percent, despite momentarily having to close above its three-month and 50-week EMAs in remarkable but phony bullish rebound moves.
As a result, a price reduction below the 20-week and 50-week EMAs could signal the start of another round of selling in the market.
WAVES’ selloff level
To recap, WAVES, the native symbol of the same-named blockchain platform, has risen by up to 88 percent week to date, reaching more than $21 per token over the weekend.
As previously reported by Cointelegraph, the migration to Waves 2.0, collaboration with interoperable cryptocurrency service provider Allbridge, and a forthcoming $150 million finance to boost Waves’ growth in the United States all served as tailwinds to the WAVES upside boom.
However, signs of a correction have emerged, with WAVES falling well almost 10% from their local high near $21 this Saturday.
The curve point, as shown in the map below, coincides with the1.00 Falsehood line of the Retracement graph made from the 21.60- swing high to the0.54- swing low, which served as crucial resistance during the January 2018, April 2021, and November 2021 corrections.
For example, in April and November 2021, the rams attempted but failed to flip $21.60 as support. As a result, WAVES has spent more time below the 1.00 Fib level than above it, indicating an unstable upward sentiment.
According to the Fibonacci fractal, WAVES will experience a drawdown move towards its next line of support near $17, $13.50, and $11. A deciding move above $21.60, on the other hand, could prompt bulls to retest levels above $34.50.