Since the price of EOS fell below the £1.20-support in mid-September, the altcoin has been on a downtrend. The psychological £0.87-mark had been partially upheld as of the time of writing, but the bias was still bearish.
EOS could fail to break out of the resistance zone it has been struggling under in next few weeks. EOS is expected to follow BTC south on the price charts if the latter experiences strong selling pressure and moves below £16.5k.
The altcoin’s price has risen from £0.82 over the last two weeks and has since made a number of higher lows and higher highs on the 12-hour timeframe. As a result, the market structure and momentum on a lower timeframe were bullish. Additionally, the RSI increased above neutral 50. The October resistance has not yet been overcome by the A/D line.
These highs appeared to be modest when viewed on higher timeframe charts, such as the 1-day. EOS would need to surpass the £0.98-lower high in order to change the structure from bearish to bullish.
Additionally, over the last three weeks, the price has consistently tested the £0.96-zone, a liquidity pocket. Late last month, a test of this area caused EOS to quickly rise to £1.7, a move north of 11.8%.
When the area broke, the bulls were completely worn out and EOS immediately went to the £0.83-mark fast. Based on the movement of EOS from £1.7 to £0.82, a set of Fibonacci retracement levels was plotted. At £0.98 and £1.2, respectively, the 61.8% and 78.6% retracement levels act as a significant band of resistance.
A bearish order block could allow bears to leverage the confluence between the Fibonacci levels and the liquidity pocket to enter a short position on a subsequent visit to the £0.96 level. They might also think about going short at £0.96 with an invalidation above the £0.99-mark, which would be a riskier move.
Mid-August and October saw development activity go flat. The asset’s Social Dominance was around 0.04%. This means that, despite a market cap of £0.87 billion, EOS lacks popularity.
Price movement indicated that a decline was expected to occur in the next few days. This bearish thesis would be rendered invalid if EOS rose above £1 and returned to £0.96 as a support zone.