EOS’ move from the ethereum blockchain to its own mainnet is just a couple of days away, yet its native cryptocurrency is looking indecisive on the price charts.
The cryptocurrency had rallied nearly 500 percent over the six-weeks to April 29 as the news of the mainnet launch revved up investor excitement. The broad-based rally across the wider cryptocurrency markets in April only added to the bullish sentiment.
Since May 24, however, EOS has been restricted to a narrow trading range of $10–$13, according to Bitfinex data.
The fizzling out of investor enthusiasm may be linked to the identification of security flaws in the EOS platform. On Tuesday, Qihoo 360, a China-based internet security firm, said it had informed developers of potentially serious vulnerabilities in the platform, which now appear to have been patched.
In response, the price of EOS fell from $12 to $10.70, but soon regained the lost ground alongside a $400 rally in bitcoin prices.
Further, the company’s lack of responsiveness to issues such as general confusion over the voting procedure for block producers (validators) may have taken the shine off the June 2 launch for investors.
All that said, EOS is still up more than 200 percent from its March low of $3.87 and could shine against bitcoin in the near-term, the technical charts indicate.
EOS/USD daily chart
The above chart shows that EOS is stuck inside a falling channel – a bearish pattern. Further, its failure to retake the rising trendline on May 28 is an encouraging sign for the bears.
However, the outlook would turn bearish only below $10.33 – the low of last Thursday’s bullish outside-day candle.
In such a case, EOS will likely find acceptance below the rising channel support (seen today at $9.60) and drop to $9.72 (76.4 percent Fibonacci retracement).
On the higher side, only a convincing move above the rising trendline hurdle (currently seen at $13.45) would revive the bullish outlook and open doors for $20.
While the EOS/USD market looks indecisive, its bitcoin-denominated exchange rate looks all set for a big move higher.
EOS/BTC daily chart
The bull flag breakout seen on April 24 signals a resumption of the rally from the April 17 low of $0.0010 BTC and has opened the doors to 0.0029 BTC (target as per the measured height method, i.e. pole height added to breakout price).
Only a move back inside the flag would abort the bullish view.
EOS image via Shutterstock
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