Band Protocol (BAND) has been making attempts at breaking out above the $7.30 area since the beginning of November.
While BAND is expected to be successful in reaching upper resistance levels, a short-term drop could occur prior to the breakout.
Band Protocol Breakout Analysis
The BAND price has been moving upwards alongside an ascending support line since reaching a low of $3.28 on Oct. 23. The increase has twice taken BAND to the $7.30 area, which has promptly rejected it after.
When combined with this resistance area, the support line creates an ascending triangle — often considered a bullish pattern.
While a breakout that travels the entire height of the pattern would take BAND to the 0.618 Fib retracement level at $11.76. The primary resistance area seems to be found at $14.90, which is a horizontal resistance level and the 0.5 Fib retracement level of the previous decrease.
Despite the bullish price action, technical indicators are neutral/bearish.
Cryptocurrency trader @TalkingCrypto outlined a BAND chart, stating that it would likely go to $21 if it breaks out above the current descending resistance line.
While this is a possibility, there are numerous resistance levels left to clear before BAND can come close to this level.
The two-hour chart more clearly shows that BAND has already created one lower high before falling towards the support line once more.
Despite the bounce, technical indicators do not give any bullish reversal signals.
In addition, the movement between the two highs looks corrective, indicating that another decrease is likely in store before BAND eventually moves upwards.
Therefore, it would be expected for BAND to break down towards the $5.40 support area before eventually moving upwards once again.
A look at the 30-minute chart shows that since reaching a high on Dec. 8, BAND had been following a descending resistance line. This same line rejected the price the next day.
The rejection also coincided with the 0.618 Fib retracement level, suggesting that the increase was corrective.
This trendline can be a good gauge of the direction of BAND’s trend.
While the most likely scenario remains a drop towards $5.40, a move above this line would suggest that BAND is making a breakout attempt above $7.50 instead.
The direction of the Band Protocol trend seems unclear at the moment, but a drop towards $5.40 remains the most likely scenario.
A breakout above the short-term descending resistance line would potentially invalidate this scenario and suggest that BAND will make another attempt at breaking out above $7.30.
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