Potential reversalA closer look at the daily chart shows that SNX has broken down from the $7.20 area and validated it as resistance afterwards (red icon). Previously, the area had acted as support since July 2021. Despite the drop, both the RSI and MACD have generated very significant bullish divergences. These divergences preceded the breakout from the short-term descending resistance line. Due to the fact that they developed over a significant period of time, it is possible that the upward movement as a result of the divergences has not yet ended. However, until SNX manages to reclaim both the horizontal area and the descending resistance line, the trend cannot be considered bullish. In the short-term, SNX is trying to reclaim the $4.50 horizontal support area, which is also the 0.618 Fib retracement support level. Similarly to the daily time-frame, the two-hour MACD has generated bullish divergence. A successful reclaim of this area would support the possibility that the downward movement has come to an end. If so, the most likely path would suggest an increase towards the long-term descending resistance line at $10. BeInCrypto’s latest Bitcoin (BTC) analysis, click here
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