2 May 2022 [analysis]

Monero Observer XMR TA Report - Week 17, 2022


XMR opened at 252.22 (Poloniex XMR-USDT), peaked at 262.5 on Tuesday and closed the week’s action at 212.33 (-16.14%~).

The action

Week 17 action was almost completely dominated by the bears. By Tuesday it was quite clear that the bulls would probably be unable to register their 9th consecutive weekly win against a very determined bear force.

The bulls started the week with a promising defense of 240 around the 3h 200 EMA. This small win was used to mount a quick attack aimed at creating a higher high above 290.

However, that attempt failed miserably on Tuesday, when the bears showed up to defend the 50 exponential below 260, essentially overwhelming the bulls.

The resulting counterattack was unexpectedly strong and pierced all moving average support lines on most hourly charts, including the 4H, leaving behind a menacing 12%+ bearish engulfing candle on the daily.

Bullish forces struggled to stay in the game until the weekend, but unfortunately for them, the bears had already moved their resistance lines forward to the 200 EMA on the 4H, around 235.

With no real support in sight, mounting pressure from death crosses forming everywhere and RSI returning to bear territory, the bulls decided to give up and retreat from the death trap towards the 200-210 area, hoping to rendezvous with reinforcements at the key .618 Fibonacci retracement level.

Action closed at 212.3, abruptly ending the week with a resounding -16.14% bear victory. The bulls are slowly realizing that it’s not over and their troubles are just beginning.

Potential scenarios

As I am writing this report, the bears are pushing their luck below the weekly 50 EMA, planning to flip 200.

The bulls have temporarily lost momentum after their winning streak was interrupted. They should switch to a correction mode stance.

As previously reported:

The bulls must stay above 220. If they can, optimally, find a reliable support above 250, they should be able to easily flip 265 and potentially close above 288.

Failed. Although they did manage to touch 260 on Tuesday and stay above 220 for most of the week, the bulls were forced to abandon that support on Sunday after consistent bearish pressure.

The bulls should expect 180 strikes soon and a solid defense should already be in the works. That level should be impenetrable.

If the bulls can construct a higher low, ideally above the 180-200 zone, then we can expect a new impulse wave up in the following weeks.

A close above 220 would open up a way to clear 240 and expose 290 once more.

The bears are back. But they should be careful not to overplay their hand, as the bulls might still hold some aces.

As previously reported:

This week is crucial, as the bears have less than 5 days to prevent the bulls from completing the third candle in their three white soldier formation, which is super bullish and indicates a bullish reversal on the monthly chart.

Check. Dramatically, last minute bearish speculative efforts resulted in the complete denial of the third white soldier bullish candle on the monthly.

No compromise: the bears have to target 209 and at the very least close below 220. That should bring back RSI into a more neutral territory on most charts and could potentially give the bears another shot at 180 soon.

Check/in progress. Bears targeted 209 and successfully closed below 220, at 212.33. Now they are preparing for the tough battle ahead, most probably around 180.

If the bears can hold on to the initiative and keep the action sandwiched between the 50 and 200 EMAs on the weekly, below 215, they should be able to reverse the daily golden cross soon.

A close under 180 would expose the weekly 200 exponential support around 150. Victory there would force a bitter bull retreat towards 135.

Other fronts

On the BTC front (Poloniex XMR-BTC) the bulls had to temporarily scrap offensive plans after they were blocked by bear defenders just under the monthly 50 EMA resistance.

The week started at .006402 with a bear attack that failed to pierce .0061. The bulls retaliated with a move on .0065 on Tuesday, but that was quickly blocked just below the 2H 50 EMA.

The bears flipped .006 the very next day, with a solid move that would eventually push the action below several hourly chart moving averages by the end of the week.

Bull patriots used the 4H 200 exponential support around .0056 to mount several attacks on the recently lost psychological level, but none were strong enough to regain control of .006.

The action closed at .005527, with a comforting -13.65% win for the bears, leaving behind 6 daily red candles.

The bulls blew another shot at breaking the long-term descending parallel channel.

As previously reported:

If the bulls can stay above .0057, and ideally above .00615, they should get another chance to print a higher high very soon.

Failed. Although the bulls did touch .006538 this week, they simply could not stay above .00615 or find a reliable support at .0057.

If the bulls can deny bear access below .005 and ideally keep control of .00525, they should be able to use the .786 fibs to support new offensive plans targeting the .0057-59 zone.

A break above .0065 would expose .007 to another bull strike.

The bears are getting close to trapping the bulls and reversing the golden cross on the daily.

As previously reported:

If the bears can keep the monthly RSI below 50, flip .006 and close below the 4H 200 EMA around .0055, they should be able to attack .0053 next.

Check. The bears have done everything precisely as reported: RSI now sits at 45, .006 was flipped and action closed just below the 4H 200 EMA at .005527. Impressive.

A close below .005 would undo most of the damage, reverse the daily golden cross, trap the bulls and expose .0046.

Ongoing. This is probably the next item on the bear agenda.

If the bears can break the daily 200 EMA support with a close below .0049, we should see .0046 attacks next.

Victory in that region might trigger a bull panic retreat to defend .0038.

This is a weekly report that I will try and publish every Monday. Hope you enjoyed it. I love getting feedback @ /about/.

Older XMR TA reports can be found on the /tag/analysis page.