Benzinga - A pseudonymous cryptocurrency analyst issued a warning to investors and traders in the digital currency ecosystem, predicting a gradual decline for several prominent cryptocurrencies, including Solana (CRYPTO: SOL), Chainlink (CRYPTO: LINK), Avalanche (CRYPTO: AVAX) and the decentralized finance (DeFi) token Rune (CRYPTO: RUNE).
Altcoin Sherpa's analysis focused on specific technical indicators, particularly the .382 Fibonacci retracement levels and the 200-day Exponential Moving Averages (EMAs) on the four-hour charts.
These indicators are often used by traders to predict potential reversal points or support levels in the market.
In the tweet, Altcoin Sherpa said, "Many .382 fibs + 200 EMAs (4h) are coming up on some of the best coins. $LINK $SOL $AVAX. These areas + the .50 fib are the regions I'm eyeing."
This suggested Altcoin Sherpa was closely monitoring these levels as potential areas where the price might stabilize or rebound.
The analyst expected a "grind down" period for these cryptocurrencies before any significant upward trend continued. This term refers to a slow and steady price decline rather than a sharp drop.
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Altcoin Sherpa believed this gradual decrease would lead to a period of consolidation, which was a phase when prices stabilize and move sideways.
The analyst anticipated this consolidation will form a strong base for a potential robust upward movement in January for many of these digital assets.
Regarding the DeFi token RUNE, Altcoin Sherpa's analysis followed a similar pattern.
He tweeted, “RUNE: Same setup as the others…would love to see a 0.382 [Fibonacci level] tap +200 exponential moving average on the four-hour chart.”
This indicated his expectation that RUNE would also experience a decline to its .382 Fibonacci level combined with the 200 EMA, which could be a crucial juncture for the token.
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