The EOS market initially tried to rally a bit on Wednesday, but it continues to see a lot of resistance near the $1.00 level. At this point, the market is likely to continue to see sellers in that general vicinity, as this is an area that has been noisy for quite some time. The 50-day EMA is sitting near the $1.20 level and is drifting lower. That was the scene of the previous consolidation area, so I think it all comes together for a bit of a short-term ceiling, even if we do get some type of rally.
Looking at this chart, it’s obvious that the $0.85 level has offered a bit of support in the short term, and it looks like we are going to try to break down through it. If we do, that opens up the possibility of a move down to the $0.60 level, based upon the “measured move” of the rectangle that we have drawn on the chart. Ultimately, I think we will probably go even lower than that, as the EOS market continues to see a lot of negativity, not only due to the fact that usage is minimal, but the fact that crypto, in general, has been falling apart for some time.
Looking at this chart, we would need to break above the $1.50 level to change the overall attitude, but I think it would take a lot to make that happen. You would probably need to see Bitcoin turn around, which right now does not look likely to happen. Risk appetite has been decimated in most markets, and the crypto market is no different. Because of this, I would be cautious about jumping in with a huge amount of money, but if you do believe in the EOS story, you could perhaps dip your toes in the water with very small positions.
However, as for myself, I will be watching both Bitcoin and Ethereum as a bit of a heads-up as to when we go to the upside. The market continues to sell off on rallies, and I think it will continue to be the way forward. It will be a long time before crypto wakes up out of this crypto winter, and I don’t think that EOS is going to be where it starts.
