- Summary:
- In this VeChain price prediction, we explain why the sell-off could continue as it forms a cup and handle pattern.
The VeChain price has been in a long bearish trend in the past few months as demand for the token has waned. After rising to an all-time high of $0.288 in April 2021, the coin has crashed by more than 88% to the current $0.032. As a result, its market value has declined from over $10 billion to the current $2.1 billion. It is the 37th biggest coin in the world.
The price action of VeChain has been in line with the performance of other cryptocurrencies. The most recent catalyst for the crash was last week’s meltdown in the LUNA ecosystem after Terra USD lost its peg. There are also concerns about the Federal Reserve as it gears towards more rate hikes. In a statement on Tuesday, Jerome Powell insisted that battling inflation would have some pain.
Meanwhile, the most recent VeChain quarterly report showed that the network was sufficiently capitalized. It has $1.2 billion in reserves. Despite this, the foundation spent just $4.1 million in the first quarter. It provided about $1.8 billion to boost its ecosystem and $1.1 on operations. Still, the foundation did not reveal the revenue from its VeChainThor blockchain. Like Ethereum, the blockchain collects fees that are distributed between validators and other stakeholders.
VeChain price prediction
The daily chart shows that the VET price managed to move below the important support level at $0.0389. This was a notable level since it was the lowest level on February 24th. At the same time, the coin formed an inverted cup and hanle pattern that is shown in blue. In price action analysis, this pattern is usually a bearish signal.
At the same time, the coin’s decline has moved below the 25-day and 50-day moving averages while the money flow index (MFI) has moved to the oversold level. It has alo formed what looks like a bearish pennant pattern. Therefore, there is a likelihood that the coin’s sell-off is not yet over. If this happens, the next key support will be at $0.023. A move above the resistance at $0.038 will invalidate the bearish view.
