The Enjin Coin price has reversed the November gains and is testing a significant support level. Here’s what could happen next.
Like many gaming and Metaverse cryptocurrencies, Enjin Coin (ENJ) performed well in October and November. The ENJ token gained over 300% from the September lows as investors jumped on the Metaverse bandwagon. The buying frenzy drove ENJ to an all-high of $4.845 and a $3.9 billion valuation by November 25th. However, since then, Enjin Coin has been in freefall. The project has lost almost $2 billion in market cap in the last two weeks, which leaves it languishing at #63 on the crypto league table behind Zcash.
Several factors have contributed to Enjin Coin’s decline. Firstly, as often happens, the price got way ahead of the fundamentals. Furthermore, the crypto market as a whole is lower on concerns the Fed will accelerate the taper timeline. Additionally, the ongoing congressional hearing regarding crypto regulation is encouraging some profit-taking. As a result, the Enjin Coin price appears vulnerable to further liquidation in the coming days.
The daily chart shows ENJ is trading just above the $2.57 support level (0.618 Fibonacci retracement level and mid-November lows). In my opinion, a close below the support could trigger an extension towards the 200-Day Moving Average at $1.87. Whereas an exaggerated downside move targets the long-term trend support at $1.43.
However, a close above the 0.5 Fibo could encourage buying. Therefore, a daily close above $3.00 invalidates my bearish view.
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This post was last modified on Dec 10, 2021, 02:19 GMT 02:19