DFI.Money (YFII) Bounces at Support Conveying Possible Breakout

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In Brief
  • YFII has bounced at the $2,900 support area.

  • The price is following a descending resistance line.

  • YFII is likely still in a correction.

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The DFI.Money (YFII) price looks to be in the process of breaking out from a descending resistance line.

The YFII price has been decreasing since reaching a local high of $6,940 on Sept 12. The downward move that followed culminated in the price hitting a low of $2,820 on Sept 24.

YFII Following a Descending Resistance Line

Throughout the decrease, the price has been following a descending resistance line and is currently in the process of making a breakout attempt.

If successful, the closest resistance area would be found at $4,900, which is the 0.5 Fib level of the entire decrease.

YFII Chart By TradingView

Possible Breakout

Technical indicators are showing that the possibility of a breakout is high. There is a bullish divergence in both the RSI and MACD and the latter is close to moving into positive territory.

Furthermore, the price has bounced at the $2,900 support area, which acted as the low during the beginning of September. A breakdown from this area could trigger a rapid decrease.

Considering these signals, a breakout from the descending resistance line seems the more likely scenario.

YFII Chart By TradingView

Cryptocurrency trader @Devchart outlined a YFII chart that shows a possible breakout, which could lead to an eventual increase of 40%. Due to the analysis from the two previous sections, this seems like the most likely scenario.

Source: Twitter

Wave Count

Beginning on Sept 1, the price has likely begun an A-B-C correction (shown in black below) and looks to be nearing an end.

However, the price will likely dip down another leg, since the C wave has yet to reach the 0.618 Fib length of the A wave, which is the minimum length it often reaches.

In addition, we cannot count five waves down (red) for the C wave. This makes it likely that if a breakout occurs, it will only be a corrective bounce after which the price will reach another low.

A possible target for the final low is estimated to be $2,570.

YFII Chart By TradingView

To conclude, the YFII price is expected to break out from the current descending resistance line. However, the most likely scenario is that the price will test one more lower-low first.

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Valdrin is a cryptocurrency enthusiast and financial trader. After obtaining a masters degree in Financial Markets at the Barcelona Graduate School of Economics he began working at the Ministry of Economic Development in his native country of Kosovo. In 2019, he decided to focus full-time on cryptocurrencies and trading.

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