KAVA Bounces After Prolonged Decline

Share Article
In Brief
  • KAVA has bounced at the $1.35 support area.

  • The price has broken out from a descending resistance line.

  • KAVA appears to be in the C wave of a short-term A-B-C structure.

  • promo

    Want to learn how to trade? Get a beginners guide from _BeInCrypto Academy_ now!

The Trust Project is an international consortium of news organizations building standards of transparency.

The Kava.io (KAVA) price has been increasing since it bounced at an important support area at the beginning of Nov.



The price has broken out from a resistance line and is likely to move upwards in the short-term. The direction of the long-term trend is still unclear.

Bounce at Support

KAVA has been falling since it reached a high of $5.53 on Aug 17. The decline continued until the price reached the $1.35 support area at the beginning of Nov, briefly ending up with a low of $1.21 on Nov 4. KAVA has been rallying since.



If the price continues moving upwards and retraces the entire price decline, the closest significant resistance area is found at $2.86, the 0.382 Fib retracement level measured from the Aug 17 high.

KAVA Chart By TradingView

Technical indicators on the daily time-frame are bullish but have not yet confirmed the trend reversal. The RSI has formed bullish divergence and has begun to move upwards. The Stochastic Oscillator has yet to make a bullish cross, and the MACD is below 0.

Therefore, while a short-term bounce seems likely, we cannot yet state with certainty that the ongoing downward trend has ended.

KAVA Chart By TradingView

Short-Term Breakout

The 6-hour chart shows that KAVA has broken out from a descending resistance line that had been in place since Sept 27.

The increase was short-lived, and the price fell below the $1.60 area after briefly deviating above it. The area is now likely to act as resistance.

However, technical indicators suggest that a breakout could occur since both the RSI and the MACD are increasing, and neither has generated bearish divergence.

KAVA Chart By TradingView

Wave Count

Cryptocurrency trader @CryptoTony_ tweeted a KAVA chart, stating that the price will soon begin a new impulse and move toward $1.85.

Source: Twitter

It appears that KAVA has completed a bearish impulse (shown in black below) with an extended third wave (blue) and has now begun an A-B-C correction (black).

The cluster of Fib confluences is found near $1.90, the 0.5 Fib level of the decline, and the length of A projected to C. This level aligns with the target given in the tweet.

Therefore, the price should reach this level before possibly resuming its downward trend once more.

KAVA Chart By TradingView

Conclusion

To conclude, while it seems likely that KAVA will rally and reach $1.90, there are no definitive signs yet that the long-term trend has turned bullish.

For BeInCrypto’s latest Bitcoin analysis, click here!

Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
Share Article

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.

Follow Author

Daily signals, Bitcoin analytics and traders chat. Join our Telegram today!

Let’s Go

What are Crypto Wallets? Everything You Need to Know

Learn now