Here we break down the Decentraland price action over the last few days and assess potential trading set-ups in the future.
Decentraland (MANA) has pulled back around 15% in the last three days, mainly due to softer risk appetite on Omicron variant and Fed taper fears. The MANA token is down 4% in early Thursday trading, close to 26% below last week’s $6.09 all-time high, but holding a 527% gain since Facebook rebranded to META on the 28th of October. At the current valuation, Decentraland’s market cap is approximately $8.25 Billion, ranking it just above Axie Infinity as the 23rd most valuable cryptocurrency.
Over the last week or so, Metaverse-related cryptos have retraced from the highs. Like GALA and The Sandbox, MANA has rolled over towards a significant support level, potentially predicting an exaggerated move.
Looking at the daily chart, we see the Decntraland price is testing trend support at $4.430. The trend has been the dominant theme over the last month, and therefore, a close below could trigger a sell-off.
If MANA starts to break down below the trend, a logical destination is the 50% Fibonacci retracement level at $3.420. But we also can’t rule out an extension towards the 61.8 Fibo if cryptocurrencies follow the equity markets lower.
For now, the uptrend is holding, and as long as that remains the case, the bull market is intact. However, in my opinion, it’s only a matter of time before it gives way. As mentioned, the bearish argument relies on MANA falling out of its uptrend. And even in that event, a close back above the trend line invalidates the pessimistic call.
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