Monero has formed lower highs and higher lows to create a symmetrical triangle pattern on its 4-hour time frame. Price is currently testing support and might be due for a bounce back to the top.
However, the 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse or support is more likely to break than to hold. In that case, Monero could slide by around the same height as the chart pattern, which spans $80 to $140.
Also, stochastic is turning lower from the overbought zone to signal that sellers are taking over while buyers take a break. Meanwhile, RSI is cruising sideways to reflect consolidation action. If support holds, another bounce to the top at $120 could be seen.
Monero might draw support from the huge drop in its transaction fees, though, as it might encourage more traders to use this particular digital asset. This drop was due to the recent Monero hardfork which took place on 18th October.
This release was known as, “Monero 0.13.0 “Beryllium Bullet” that aimed for greater efficiency of their protocol, to facilitate stronger privacy, faster and more cost-effective transactions.
More specifically, the update involved implementing Bulletproof, which is a short non-interactive zero-knowledge proof without a trusted setup, and was already introduced earlier this year. The privacy feature of Monero has been replaced by Bulletproof technology, enabling developers to aim for reducing the size of the anonymous transactions in the network by 80% by the new implementation.
Images courtesy of TradingView
