VeChain price has been in a tight range in the past few days as cryptocurrency consolidation continued. VET was trading at $0.023 on Wednesday, which was slightly above the year-to-date low of $0.020. It has a market cap of more than $1.76 billion.
VeChain has been in a tight range recently even as activities in the financial market remained substantially volatile. The VIX index, which measures the options activity of the S&P 500 moved from about $18 to more than $30 in September. A high volatility is usually accompanied by weak performance of risk assets like cryptocurrencies and stocks.
Therefore, VeChain’s price action is mostly because of its correlation with Bitcoin and other cryptocurrencies like ETH and XRP. Bitcoin has remained at $20,000 while Ethereum has remained at $1,300. Historically, cryptocurrencies tend to move in lockstep with that of Bitcoin.
Therefore, the next price action of VeChain will be determined by what Bitcoin does. And with American stocks rallying, there is a likelihood that Bitcoin will continue rising since it has failed to move below the support at $19,000. Similarly, Bitcoin’s hash rate has surged to a record high, which is a bullish sign.
In my last VET prediction, I wrote that the coin was a bit bullish. The daily chart shows that the VeChain price has been in a strong bearish trend in the past few months. Recently, however, the coin has managed to consolidate and is currently at the 25-day and 50-day moving averages.
A closer look shows that the Relative Strength Index (RSI) has formed a bullish divergence pattern that is shown in yellow. VeChain has also struggled to move below the important support level at $0.02145.
Therefore, while it is too early to say, and while VeChain has formed a head and shoulders pattern, there is a likelihood that the coin will bounce back. If this happens, the next key level to watch will be at $0.0275. A move below the support at $0.021 will invalidate the bullish view.
This post was last modified on Oct 05, 2022, 09:12 BST 09:12