Theta Token (THETA) has been increasing since bouncing at the support line of a descending parallel channel on May 19.
It is approaching a convergence point between support and resistance, thus indicating that a decisive movement will soon occur.
Ongoing THETA bounce
THETA has been decreasing inside a descending parallel channel since April 16. At the time, it had reached an all-time high price of $15.88.
It reached the support line of the channel on May 19 and bounced, leaving a long lower wick behind. The bounce also coincided with the 0.786 Fib retracement support level at $3.92 (black).
The movement inside the channel resembles an A-B-C corrective structure (white), in which waves A:C have a 1:1 ratio.
Currently, it is trading right at the resistance line, making its fifth breakout attempt.
Technical indicators are bullish. The MACD has nearly crossed into positive territory and the Stochastic oscillator has made a bullish cross. The RSI is also in the process of moving above 50.
A breakout could take the token towards the all-time high resistance area of $14.50.
Cryptocurrency trader @PostyXBT outlined a THETA chart, stating that the flip of the $8 support area is a strong bullish development.
The short-term resistance area that has turned to support can be isolated at $8.30.
Currently, THETA is approaching the convergence point of the resistance line of the channel and this horizontal support area.
Therefore, a decisive movement is expected to occur soon.
Technical indicators in the six-hour time-frame are not as bullish. The RSI has reached the 50 line from above and the MACD is in the process of crossing negative.
However, due to the bullishness in the daily time-frame and the fact that parallel channels are often corrective movements, a breakout would be more likely.
A close below the $8.30 support area would invalidate this possibility and cause THETA to drop towards the middle of the channel instead.
Similarly to the USD pair, THETA/BTC has been increasing since May 19. It reached a new all-time high price of 28,000 satoshis on June 7.
However, the higher price could not be sustained, and the token has fallen below the 26,000 satoshi area, which is now likely to act as resistance.
THETA/BTC is attempting to find support at the descending resistance line from which it broke out and the 20,700 satoshi support area.
However, until the 26,000 area is reclaimed, the trend cannot be considered bullish.
For BeInCrypto’s latest BTC (BTC) analysis, click here.
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