In August, the OmiseGo cryptocurrency rate staged an aggressive rally, but was never able to close the weekly trading above an important area of resistance. It is not yet clear if the trend remains bullish.
Long term support
In early August, the OmiseGo (OMG) cryptocurrency began active growth and eventually reached a maximum of $9.86 on August 21. However, the price bounced off the 0.382 Fib level of the correction of the previous bearish move and was never able to close the trades above the $7.30 area. Instead, a long upper wick appeared on the weekly chart, which is a sign of selling pressure.
The area highlighted above played the role of support for more than a year earlier, and now it has turned into resistance. In the meantime, the immediate support is at $2.70.
Technical indicators are giving weak bearish signals. The Stochastic RSI has formed a bearish crossover, while the MACD and RSI are declining, but there are no signs of bearish divergence on the charts.
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Cryptocurrency trader @Pierrecrypt0 shared an OMG chart on Twitter, suggesting that the price could continue to rally towards the $5.20 range highs.
An analysis of the daily OMG chart shows that the pair found support above the 50-day moving average (MA) and then consolidated above it for the past five days.
In addition, the MACD and Stochastic RSI are rising, with the latter likely to form a bullish crossover. However, the RSI is holding below 50 and is not yet showing bullish divergence signals.
Nevertheless, the price with a high degree of probability can bounce in the direction of $5.20, and possibly $5.76 (Fibo level 0.382 of the correction of the entire bearish move).
Wave analysis of OMG dynamics looks somewhat uncertain. It looks like the market has already formed a bullish 5-wave impulse structure (blue), judging by the scale of the growth of the fifth wave compared to waves 1-3. In this case, the price has now started the A-B-C correction, which means that the bounce we assumed earlier is wave B.
However, the analysis of the sub-waves suggests that the fifth wave has not yet been formed (orange), and the discussed bounce is the beginning of the fifth – and final – sub-wave.
In the future, the analysis will become more unambiguous, however, we still expect a rebound from the current level – whether it be within wave B or the beginning of the fifth sub-wave.
Note that below we have provided a logarithmic chart to better visualize the price dynamics taking into account the extended fifth wave.
The weekly chart for OMG/BTC shows that the pair failed to close above the 45,000 satoshi area, which represented long-term support. In addition, the price has formed a long upper wick similar to that seen in the pair with the USD.
Until the price manages to close above this resistance area, we cannot say with certainty that the OMG has started a bullish trend.