Decentraland (MANA) price surged 150% in the past two weeks and broke above the 406-day resistance line.
Since hitting an all-time high of $5.90 in November 2021, Decentraland price had fallen below a descending resistance line. The downside movement reached the December 2022 low of $0.28.
MANA price subsequently bounced higher, validating the $0.30 horizontal support area in the process. This was a significant development as the $0.30 area was both a sideways and Fibonacci support level. Consequently, a breakdown below it could further accelerate the rate of decline.
Since the boom, MANA has increased in price by 150%. Last week, it broke the long-term descending resistance line and the $0.51 horizontal area, which is now expected to act as a support. Besides, the weekly RSI is in the process of moving above 50.
If this happens, then MANA token price could move towards the next resistance at the average price of $1.10. Conversely, a weekly close below $0.51 would mean that the trend is still bearish.
mind struggles to regain resistance
Taking a closer look at the movements on the daily time frame, it shows that Decentraland price is struggling to move above the $0.71 resistance area. While it briefly moved above it, it formed a long upper wick (red icon) over the past 24 hours, which is considered a sign of selling pressure.
Furthermore, the daily RSI is highly oversold, although it has not yet generated a bearish divergence.
If the rejection is confirmed, there will most likely be a decline towards the $0.51 long-term support area, as per the above MANA price analysis.
Reclaiming this territory will be necessary to accelerate the Decentraland price prediction for January.
Retracement before last breakout
The wave count also supports the possibility that Decentraland price correction is about to take place. The digital asset appears to be in the fifth and final wave of the upward movement that began on January 1st. If so, then wave five is a major extension and the length of waves one and three combined (black) is 2.61 times the length.
Additionally, the six-hours RSI has formed a bearish divergence (green line). It aligns with the wave count and rejection from the $0.71 area.
If there is a downside break, the nearest support levels will be at $0.58 and $0.52. These are formed by the 0.382 and 0.5 Fibonacci retracement support levels, respectively.
To conclude, most likely the MANA price movement will be a retracement of the uptrend that started on January 1st. The nearest supports are located at $0.58 and $0.52. A weekly close above $0.71 would invalidate this bearish short-term MANA forecast.
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