NEM (XEM) price is up 27% so far today but has not yet closed above an important horizontal resistance area. Doing so indicates that a trend reversal has begun.
Anyway, the price action and the number of waves support the upward move, which indicates that XEM has started a bullish reversal.
27% increase in the price of XEM causes a critical refund
On June 10, XEM price dropped to as low as $0.022 but reversed direction immediately after. The price has created a long wick lower (green symbol), taken as a sign of buying pressure.
After creating several higher lows, XEM accelerated its increase on July 12. To date, the price has increased by 27%. While the price is above the horizontal resistance area of $0.033, it has not closed above it yet.
This is required for the trend to be considered bullish. The next resistance is at $0.043.
The daily RSI supports a continuous rise. The RSI is a momentum indicator that traders use to assess whether the market is overbought or oversold, and to determine whether to accumulate or sell an asset.
Readings above 50 and an upward trend suggest that the bulls still have an advantage. On the other hand, readings below 50 indicate the opposite.
The indicator is above 50 (green circle) and increasing, both of which are indications of an upward trend.
XEM Price Prediction: Beginning of a Trend Reversal?
A closer look at the technical analysis on the short-term six-hour time frame gives a decisive bullish outlook. This is due to price action and the number of waves.
The price action is showing that XEM price has broken out from an ascending parallel channel. Since channels usually contain corrective movements, this makes it possible that the upward movement is not corrective. Instead, it starts a new bullish impulse that leads to new highs.
After that, the number of waves indicates that the price is in the third wave of a five-wave upward movement. Elliott Wave Theory involves analyzing long-term recurring price patterns and investor psychology to determine trend direction.
The Elliott Wave theory also states that the third wave is often the sharpest and largest bullish wave.
In the case of XEM, the third wave was longer than the first. However, it has not reached the 1.61 stretch yet. Therefore, XEM is likely to reach as high as $0.043 before correcting in the short term. This would also correspond to the long-term resistance area from the 2-day time frame.
Despite the bullish XEM price prediction, a drop below the top of the first wave (red line) at $0.033 means that the trend is to the downside. XEM could drop to the next nearest support at $0.030 if that happens.
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In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.