- SXP is confined inside an ascending channel chart pattern on the daily time frame.
- The digital asset showed vital signs of bearish divergence after it cascaded by almost 30% in one day.
- After bouncing on the support level of $2.87, SXP seems ripe and a perfect opportunity for buyers to accumulate and take advantage of the dip.
A brief observation on the intraday day chart suggests that SXP price has formed an ascending channel pattern drawn by connecting two upward sloping parallel lines characterized by higher highs and higher lows. The pattern was formed when the 50 EMA crossed from above the 200 EMA, indicating a bullish scenario known as the golden cross. While SXP was hovering in an uptrend, the RSI showed strong bearish divergence signs and was confirmed after the token diminished by 30% today. Other than that, SXP also broke out from the head and shoulder pattern, which triggered a significant sell-off between investors. The token formed a hanging man candlestick and took support on the $2.87 level, demonstrating bearish reversal.
SUPPORT TREND LINE TO PLAY A SIGNIFICANT ROLE IN PUSHING THE PRICE UPWARDS
The magnificent wick of the hanging man candlestick confused many traders who were counting on SXP price to break its previous ATHs in the upcoming sessions. The price of SXP also broke the support trend line and tested a whole new level of support at $2.87. Even though the token witnessed a major sell-off today, the bearish reversal couldn’t last long, and the price swooped upwards on the 4-hour chart. SXP only has to surpass three key resistance levels before it heads towards forming another ATH.
Currently, the token is levitating below the 20 EMA, which will test as resistance ahead. On the downside, the 50 EMA and 200 EMA will provide strong support to SXP at the ranges of $3.65 and $2.39, respectively.
On the other hand, RSI had entered the oversold category recommending a favorable buying occasion. The RSI is hanging around the range of 40, suggesting that the uptrend is likely to continue.
The MACD line has crossed from above the signal line on the one-hour chart, indicating a short-term bullish trend.
SXP may have broken crucial support levels today, but it also bounced off, forming a new support level that showcases an overall bullish scenario. Keeping this in mind, investors are aiming for SXP to test the psychological resistance at $6.5 (FIB 1.6). We can conclude that SXP had recently given a breakout from the ascending triangle chart pattern and has retested upwards on looking at the big picture. A strong sell-off today was the ideal illustration of the “buying the dip” opportunity. SXP has been in an uptrend since December, and the bullish momentum is expected to continue.
SUPPORT : $2.87 and $2.17
RESISTANCE : $4.09, $4.99 and $5.58
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