This Vechain Technical Analysis was updated December 2, 2018.
The VET/BTC crypto pair has found itself back where it started its journey on the crypto exchanges: at the price lows that followed its listing in August 2018. What is the outlook for this pair which held a lot of promise but has so far disappointed its investors?
VET continues to hold a lot of promise as far as the token itself is concerned. The team behind this project continues to form strategic partnerships with key players in the ecosystem. However, these partnerships have not yet translated into bullish price movements, largely because of the bearish sentiment that has hit the market in recent times.
The weekly chart for VET/BTC is shown below. The initial downward channel which encapsulated price action was broken to the downside. The steep fall in price on the weekly chart can be attributed to the extreme bearish price movements of the last three weeks in the cryptocurrency market.
VET/BTC Weekly Chart: November 27, 2018
However, price action has found a bottom at the site of the previous all-time low for this asset pair at 0.00000113. To get a clearer picture, we step down to the daily chart, where the price action is seen to be finding support at the identified support levels.
VET/BTC Daily Chart: November 27, 2018
Within the channel, we could see that price was unable to reach the upper channel border in the last upside swing move prior to the downside break. This “failure swing” was actually the precursor for this move, and will serve as a learning experience for newbies to technical analysis. The support levels are clearly defined on the charts.
So what are the possible trade scenarios for traders wishing to trade the VET/BTC crypto pair?
Trade Scenario 1
A continuation of the bearishness seen in the market in recent times will see a breakdown of the support area, albeit after some tests of the area by price action. If this support line is broken, a new all-time low will be attained. It will then be difficult to identify a possible floor; traders will have to determine what price will constitute a suitable floor for the VET/BTC pair.
Trade Scenario 2
The other scenario will see price action undergoing a bounce, if traders are comfortable with buying the VET token with BTC at the present levels of 0.0000113. There has to be a good increase in buying volume for such a move to materialize. It may also take several days of price tests of the support area before buyers are convinced to make their move at this price level.
Supporting this scenario is the information on the 4-hour chart, which shows the formation of a small falling wedge. This pattern typically ends in a bullish reversal.
VET/BTC 4-Hour Chart: November 28, 2018
However, the size of the pattern is quite small, therefore radical upside moves from this pattern are not expected. We can also see that the buying volume bars are not as large as the preceding selling volume bar. So at best, it is possible that the price action may rise to 0.00000130. Anything beyond this will require some strong news, or a change in the overall crypto market sentiment. We also need to see bigger buying volumes.
The long-term, mid-term and short-term outlook of the VET/BTC pair is:
- Long term: Neutral
- Mid-term – bearish
- Short term – neutral to bullish
Please note: the price moves described on the daily chart could take several days or even weeks to evolve. Patience is required to trade these moves.
To read more about Vechain Thor project, check out the official price prediction article for VET, and check back for regular updates. You can read our additional post on Three Reasons Why VET Could Rebound Soon.
Interested in buying VET? You can learn how to do so using the Guide to Buying VET on Binance.