IOTA has formed lower highs and higher lows to create a symmetrical triangle pattern on its 4-hour chart. Price just bounced off the top and could be due for a test of support soon.
However, the moving averages appear to be holding as dynamic support. The 100 SMA is also attempting to make an upward crossover from the longer-term 200 SMA to indicate that bearish momentum is over and that bulls could take over. In that case, IOTA could bounce back to the triangle top at 1.1500 from here.
RSI is still pointing down, though, and this means that there’s still some selling pressure left. Stochastic is also heading lower so IOTA price could follow suit. With that, price could still test the triangle support at 1.0000.
Sentiment in the cryptocurrency industry has improved in the past days, leading to strong gains and some breaks of key technical levels for a number of altcoins. However, many say that this was merely a short squeeze from earlier declines or a dead-cat bounce. Some also say that this is just FOMO (fear of missing out) in play as retail traders rush to join the rallies.
Then again, there have been a handful of developments that drew investors back in the game. For one, it has been reported that big hedge funds are looking into investing in the space, as confirmed by BlackRock’s CEO a few days back. Apart from that, traders also appear to be reacting to regulatory developments in Japan or South Korea more positively.
Easing trade tensions in the global economy also lifted risk appetite, encouraging traders to put funds in higher-yielding assets. IOTA could continue to take advantage of this if traders stay shy of stocks and commodities, which could still wind up being vulnerable to a trade war.