Curve DAO Token (CRV) price has completed its correction and will confirm it with a breakout from the current wedge pattern.
The CRV has been declining since July 28. Price action lies inside a descending wedge. A descending wedge is considered a bullish pattern, which means that an eventual breakout from it is the most likely scenario.
The resistance (red sign) and support lines (green sign) of the wedge have both been validated enough times to confirm their slopes and validity.
On October 13th, the price of CRV fell to a low of $0.72. Shortly after, it rose sharply and formed a long bottom wick. The wick acted to validate both the $0.76 horizontal and Fibonacci support area and the wedge support line.
As a result of this rise, an eventual breakout from the wedge is expected.
CRV price wave calculation supports breakout
The wave count is also in alignment with the readings from the daily time frame. After completing a five-wave upward movement (black), CRV price has completed an ABC corrective formation, ending with a $0.72 low above.
If the count is correct, it would mean that the CRV would now start another upward move. While it is not yet clear whether this move is an ABC formation (white) or a new impulse, a move to $1.78 would be expected either way. These waves will give the ratio of 1:1 to A:C.
However, before reaching there, there was a short-term Fib and horizontal resistance at $1.26.
A fall below the October 13 low of $0.72 would invalidate this wave count and signal that new lows are in store.
Curve DAO Token Long-Term Trend Still Undefined
Although a breakout from the wedge is likely, the long-term trend direction is still undetermined, due to mixed technical analysis readings from the weekly time frame.
There is an important resistance area at $1.40, a level that previously acted as support. Until the weekly close above this level, the longer term trend cannot be considered bullish.
Additionally, while the weekly RSI has broken below a descending resistance line, it is still trading below 50.
Therefore, a weekly close above the $1.40 area and a weekly RSI movement above 50 are needed to confirm the CRV price prediction as bullish.
Conversely, a decline below $0.72 would indicate that the trend is bearish instead.
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