SXP’s Reclaim of Lost Support Area Is Bullish for Its Long-Term Trend

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In Brief
  • SXP has reclaimed the $1.50 support area.

  • SXP has broken out from a descending resistance line.

  • The price has possibly completed an A-B-C formation.

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The Swipe (SXP) price has broken down and subsequently reclaimed a critical support level at $1.55.

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As long as the price is trading above here, it should continue moving upwards.

Reclaim of Support

On Aug 13, the SXP price reached a high of $5.15 and began a downward move that is still ongoing. The price reached a low of $1.48 on Sept 14 and began to rise.

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While it initially seemed like the price had broken down from the $1.55 support area, it proceeded to move upwards and reclaim the previously lost support level. Deviations below a support area and their subsequent reclaim often lead to a significant move in the other direction.

If the price continues moving upwards, the closest resistance area would be found at $3.10, the 0.5 Fib level of the entire previous decline.

SXP Chart By TradingView

Short-Term Movement

Cryptocurrency trader @CryptoNewton outlined an SXP chart, stating that he has entered a long and expects the price to continue moving upwards.

Source: Twitter

While the price has indeed broken out from a descending resistance line, the price was rejected at the $1.90 resistance area and is in the process of creating a double top, known as a bearish reversal pattern.

In addition, both the RSI and the MACD have formed bearish divergence. This signifies that the price is likely to fall initially, possibly towards $1.30, before making another attempt at breaking out.

SXP Chart By TradingView

Wave Count

As for the wave count, it seems that SXP has completed an A-B-C corrective structure (in black below) with its previously mentioned low of $1.48 on Sept 14. Waves A:C have a 1:1 ratio, and a bearish impulse can be outlined in the C wave (blue), making this likely to be the correct wave count.

If so, then SXP has begun an upward move since Sept 14 (highlighted).

SXP Chart By TradingView

A closer look shows that the rally looks impulsive and will take it at least to the $3.10 resistance area outlined in the first section.

SXP Chart By TradingView

To conclude, the SXP price has possibly completed its correction and is now likely to continue moving upwards towards the resistance areas outlined above.

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Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate 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.

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