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GALA Price Indecision Could Be Determined With This Indicator – Will It Bounce or Drop?

2 mins
Updated by Ryan Boltman
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In Brief

  • GALA price has broken short-term descending trendline but remains under a long-term one which also coincides with the $0.016 resistance area.
  • Despite mixed signals from the weekly RSI, daily readings indicate a more bullish outlook with RSI above 50, suggesting a trend reversal.
  • Failure to sustain the breakout can cause a 14% decrease to the long-term descending resistance line, possibly validating it as support.
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The GALA price broke out from a short-term descending resistance trendline but still trades under a longer-term one. 

The readings from the weekly and daily timeframes do not align with each other.

GALA Falls Under Descending Resistance Trendline

The GALA price has decreased under a descending resistance trendline since the beginning of the year. The high point of the trendline coincides with the yearly high of $0.062. 

During the 252 days the trendline has been in place, GALA fell by 80%, culminating with a low of $0.013 last week. 

After the low, the price bounced and is currently in the process of breaking out from the trendline. However, a weekly close above it is required to confirm the breakout.

The line also coincides with the $0.016 horizontal resistance area, increasing its significance. The next resistance is at $0.032.

GALA Price Weekly
GALA/USDT Weekly Chart. Source: TradingView

The weekly RSI does not determine the trend’s direction. With the RSI as a momentum indicator, traders can determine whether a market is overbought or oversold and decide whether to accumulate or sell an asset.

Bulls have an advantage if the RSI reading is above 50 and the trend is upward, but if the reading is below 50, the opposite is true. While the indicator is increasing, it is still below 50. The mixed signs do not provide clarity for the future trend.

GALA Price Prediction: Will Bullish Divergence Start Trend Reversal?

While the weekly timeframe outlook is still undetermined, the readings from the daily one are more bullish. There are two main reasons for this. 

Firstly, GALA broke out from a shorter-term descending resistance trendline and closed above it. The daily close confirms that the breakout is legitimate. 

Secondly, the RSI generated a bullish divergence (green line). A bullish divergence occurs when a price decrease is combined with a momentum increase. It often precedes bullish trend reversals. The RSI is now above 50, another sign of a bullish trend. 

If the increase continues, the next resistance will be at $0.021, 30% above the current price. 

GALA Price Prediction
GALA/USDT Daily Chart. Source: TradingView

Despite this bullish GALA price prediction, a sudden loss of momentum could take the price back to the descending resistance line, validating it as support in the process.

The line is at $0.014, 13% below the current price.

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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