Following a bad start to the week, Compound has since recovered and is currently on its third day of uptrend. Bitcoin Cash also experienced the same sentiment but is showing signs of slowing down.
These tokens express what has transpired in the market over the last three days. Closing the previous intraweek session at $2 trillion, the global crypto market cap suffered a massive correction that saw it lose more than 6% of its on Monday.
The next two days were spent recovering the lost gains and the sector is currently worth $1.9T. We observed that altcoins were the main movers of the industry as most major projects are struggling to start an uptrend.
The little positive change in valuation has continued over the last 24 hours as the industry is still up by a few percent. With no signs of major retracement, it may gain more stability above $1.95 trillion and close the seven-day session within this level.
Compound Struggling to Hold Momentum
Compound has been on an uptrend for almost three days now. The gradual increase in price started on Tuesday with an 10% increase, followed by several small price changes. However, the token is struggling to hold on to this momentum as the candle representing the current intraday session has lost most of its body.
The reason for the reverse in sentiment is not far-fetched as we observed that the strong bullish drive seems to be diminishing. The steady rise in prices started as soon as Robinhood announced it was listing the asset on its platform.
The thrill of the listing is dying, hence the current state of the market. Indicators, on the other hand, are painting a different picture. For example, compound is trading above its pivot point which suggests that the token may continue to enjoy bullish conditions.
Backing up this claim is the Moving Average Convergence Divergence (MACD). A closer look at the above chart reveals that the asset under consideration is experiencing a bullish convergence.
A bullish divergence is soon to follow, which may indicate more uptrends ahead. Additionally, COMP is exchanging above its Displaced Moving Average (DMA) which supports the previously highlighted claims. How high will the token go?
Key Levels to Watch
Key Resistance: $175, $200
Key Support: $120, $140.
Currently exchanging at $150, the impending uptrend may send compounds to test the $175 resistance. it is important to note that the Relative Strength Index is also on the rise, which hints at an increase in demand concentration.
We also observed that the said resistance is a tough one as previous attempts over the last 30 failed to yield results. However, with the current momentum, we may see a retest of the $175 resistance and a possible flip.
Once the highlighted level flips, the bulls will to sustain another uptrend that could send the token as high as testing the $200 resistance. A reverse in market sentiment may leave COMP struggling to hold on to the $140 support.
Further downtrend will mean a retest of the $120 support. However, this seems unlikely once the asset under consideration gains stability above $175.
