Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
- NEAR was bullish at press time.
- But a key technical indicator was showing an increasing divergence, at press time.
NEAR Protocol [NEAR] more than doubled in value after the January rally. It jumped from $1.247 to $2.721 but later fluctuated. At press time, NEAR’s value was $2.501 but increasingly faced a likely correction because of divergence from a technical indicator.
Read NEAR Price Prediction 2023-24
NEAR’s increasing RSI divergence Is a correction likely?
Source: NEAR/USDT on TradingView
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The daily chart showed a bullish NEAR fronted a successful rally in January but faced price rejection at the overhead resistance level of $2.721. However, the rising price action was the opposite of its Relative Strength Index (RSI).
The RSI has exhibited a downtrend from mid-January – a divergence with price action that could suggest a possible correction in the next few days.
Based on the height of the recent price consolidation range of $2.323 and $2.721, the correction could target the support level at the 50% Fib level of $1.984.
But the drop could also be held by the 100-day EMA, or 61.8% Fib level. These could act as short-selling targets if the correction occurs.
However, the above bias would be invalidated if bulls break above the 100% Fib level of $2.721. Such an upswing will allow bulls to retest the October support level of $2.771 or the November high of $3.342.
NEAR saw fluctuating OI and a decline in active users
Source: Coinglass
As per Coinglass data, NEAR’s fluctuating open interest (OI) rates undermined a strong uptrend rally. At press time, NEAR’s OI had dropped sharply but flattened out, indicating a possible change of momentum that could support NEAR’s uptrend.
However, an extended drop in OI could undermine further uptrend as more money moves out of NEAR’s futures market.
On the other hand, NEAR’s daily active users and trading volumes dropped from mid-January. The trend shows fewer accounts were trading NEAR, which could undermine buying pressure needed for a strong uptrend momentum.
As a result, bears could be tipped to devalue NEAR and set it into a correction.
Source: Token Terminal
Source: https://ambcrypto.com/near-protocols-near-key-divergence-calls-for-investors-caution/