NEAR Protocol (NEAR) Is At A Decisive Moment, Will The Price Recover?
NEAR Protocol (NEAR) has been rejected by the 20-week EMA line and is currently approaching the support line of the ascending triangle. How the price reacts to this line can determine the short-term trend.
20-week EMA line
NEAR Protocol (NEAR) broke above the long-term descending resistance line at the beginning of January with a large bullish candlestick. This move also helped the price reclaim the important support level at $1.8. Therefore, the long-term downtrend may have ended.
However, the price has been rejected by the 20-week EMA line. This is an important line to watch as it previously prevented a rally in August 2022 and September 2022 (red arrows).
Therefore, NEAR needs to break out and close the weekly candle above this EMA line to turn the trend bullish. If successful, the price could rise to the next resistance level at $5.6.
The RSI indicator being below 50 and not showing any bullish divergence suggests that the uptrend is still weak. Therefore, the token may need to consolidate or drop back to the $1.8 level before recovering. This level also coincides with the Fib 0.618 support level, making it even more important.
Ascending Triangle
The short-term outlook seems more bullish as NEAR is trading inside an ascending triangle after a strong rally since the beginning of the year. This is a bullish pattern and usually leads to a breakout in most cases.
The price is currently approaching the triangle support line ($2.2), which has previously helped the price recover strongly twice. Therefore, it may help the price recover once again.
The RSI indicator is showing hidden bullish divergence (green line), supporting the possibility of a recovery. If so, the price may bounce from the current level and retest the pattern’s resistance line.
Breaking below the triangle would invalidate this possibility and indicate that NEAR may drop to $2 and lower to the long-term support level at $1.8, as mentioned above.
Conclusion
Although the short-term outlook is uncertain, the long-term outlook for NEAR is still bullish. How the price reacts to the support line of the ascending triangle can determine the short-term trend.
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