Curve DAO Token (CRV) has bounced at an important support area and is trading inside a bullish pattern.
CRV has been falling since reaching an all-time high price of $6.80 on Jan 4. So far, the downward movement has led to a low of $1.89 on Feb 24. CRV bounced afterwards, creating a long lower wick in the process (green icon).
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The bounce also served to validate the $2 horizontal area as support. The price has been trading above this level since Aug 2021.
Measuring from the all-time high, CRV has decreased by 68%.
Current CRV pattern
The daily chart shows that CRV has been trading inside a descending wedge since Jan 24. The descending wedge is considered a bullish pattern.
Therefore, a breakout from it would be the most likely scenario.
The possibility of a breakout is also supported by the MACD and RSI. Both indicators are moving upward and have generated bullish divergence (green lines). Such divergences often precede bullish trend reversals.
If a CRV breakout occurs, the closest resistance would be at $3.75. This is the 0.382 Fib retracement resistance level and a horizontal resistance area.
Wave count analysis
Cryptocurrency trader @TheTradingHubb tweeted a chart of CRV, stating that the correction could soon be complete.
The most likely wave count does suggest that CRV is in wave C of an A-B-C corrective structure. Wave C has seemingly evolved into an ending diagonal, as is visible by the wedge shape.
Currently, waves A:C have had a 1:1.27 ratio, which is relatively common in such structures.
As of right now, it is not yet certain if the final sub-wave (black) of this formation has been created, or another slightly lower low will follow.
In any case, it does seem like the corrective structure is coming to an end.
For BeInCrypto’s previous Bitcoin (BTC) analysis, click here
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