The Compound (COMP) cryptocurrency renewed its all-time high in trading on September 1, but rolled back and fell sharply on the same day. Altcoin is likely to find support near current levels before resuming its rally.
Long term range
COMP has been strengthening at an accelerated pace since August 25, when it hit a low of $ 161. Growth continued until September 1 – on that day, quotes renewed a record high at $ 272.61 and moved on to a correction.
Having failed to maintain the achieved heights, prices went on the defensive and are now approaching insignificant support of $205. If this level is lost, the next support is expected at $160.
Technical indicators paint a mixed picture. Stoastik RSI is preparing to form a bullish crossover, but has not yet confirmed it. The RSI is signaling bearish divergence, which has already resulted in a recent drop in price.
At the same time, while the coin is holding above the support level of $ 205, COMP is expected to resume its growth.
Cryptocurrency trader @damskotrades notes on the COMP chart that the price has broken the previous record high. At the same time, the trader cannot yet identify the next target for the altcoin in case the growth continues.
Since the price is near record highs, and a breakout of the current resistance will send it to new highs, it is advisable to use Fibonacci retracement levels to determine the next high.
Altcoin appears to have embarked on a third wave in a bullish impulsive five-wave structure, which could top down to $412. This target was identified based on the 1.618% Fibonacci retracement level relative to wave 1.
If it falls below the low of the second wave of $160, this wave analysis will lose its relevance.
The third wave can be realized in the form of five sub-waves, and now the price is at the stage of the fourth sub-wave.
If it falls below the high of the first wave of $190 before the completion of the fifth wave, this analysis levels out.
So COMP will ultimately likely break through the $260 resistance and continue to climb new highs with a primary target of $412.