VeChain (VET) is in the process of breaking out of a longer term descending wedge. The wave count shows that a bottom has been reached.
VET has been declining since reaching an all-time high of $0.279 in April 2021. The downward movement is contained within a descending pattern, which is considered a bullish pattern.
The June lows settled as low as $0.02 before the price bounced back and started the current upward movement. The bounce came after the price rebounded from the horizontal area of $0.0215.
This is an important area as it previously acted as resistance from June to December 2021. So, it has now turned to support.
While the exact line of the slope cannot be accurately determined due to the presence of several long upper wicks, it appears that VeChain is in the process of breaking up.
If true, this is likely to be a significant upward move, as the wedge is in place for 370 days.
VET Trading Range
The daily chart provides a relatively bullish outlook. VET broke the $0.0265 resistance area and later validated it as support (green icon).
With the breakout, the daily RSI has moved above 50 and is still rising. This supports the possibility that the upward movement will continue. If so, the nearest resistance area will lie at $0.0337.
If the price reaches this area, it would mean that it has definitely broken out of the longer term wedge, hence indicating that the longer term trend is bullish.
wave count analysis
cryptocurrency trader @thetradinghubb Tweeted a chart from VET saying that the price may have started a long term bullish wave 3.
The short-term count suggests that VET could be in wave three (white) of the five-wave upward movement that began in June. The sub-wave count is shown in yellow, showing a possible 1-2/1-2 wave count.
If true, this would mean that a very fast upward movement is expected to follow.
Conversely, a decrease to $0.0225 below the sub-wave two low (red line) would invalidate this particular wave count.
The long-term calculation also aligns with this reading, as it shows a potentially complete WXY structure (white) when measured from an all-time high.
In this, the A:C sub-waves (yellow) had an exact 1:1 ratio, supporting the possibility that this is a correct calculation.
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