The Nano is showing signs of strength by bouncing off the long term support area and then breaking out of the descending resistance line.
The Nano has been declining since reaching an all-time high of $17 on May 13. The downside movement has led to a January 24 (green icon) low of $1.91.
The low validated the $2 area as support. This area acted as resistance in May 2019 and now it has turned to support once again.
When measured from an all-time high, the Nano has lost 86.71 percent.
Ongoing Nano Breakout
The daily chart is showing several signs of strength.
Firstly, a very significant bullish divergence has developed in the MACD. Such events are often followed by bullish trend reversals.
Secondly, the Nano broke a descending resistance line, which was earlier in force since 30 October.
The main resistance area is at $4. It is formed by the 0.382 Fibonacci retracement resistance level and coincides with another descending resistance line (dashed) that has been in effect since September 6.
wave count analysis
cryptocurrency trader @evfib Nano tweeted a chart stating that the coin has completed its correction.
Measuring from the March 2020 lows, it looks like Nano has completed a five wave upward movement (white), leading to the high price so far.
Since then, the price has been correcting in what looks like an ABC corrective structure.
However, wave C is only 0.382 times the length of wave A, which is unusually short. However, it is possible that the reason for this is the long upper wick, which has reached an all-time high.
However, the extremely short length of wave C makes it possible that the correction is not yet complete. This also fits in with the price action, as Nano is yet to break out of its second descending resistance line or the $4 resistance area.
Therefore, unless it is successful in doing so, the reform cannot be considered complete.
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