Darkcoin has cracked below the crucial support level of 0.01617BTC and it provides a perfect selling opportunity to short-term traders. I had earlier expected the market to respect the support level and consolidate for some time, but it was also mentioned that a breach of this support should be seen as a red flag and all long positions should be liquidated then. Each Darkcoin is currently worth 0.01526BTC.
Technical analysis implemented on the 240-minute Darkcoin/BTC price chart above reveals that a major support has been breached decisively and that more losses will follow in the coming sessions.
Price Action – As can be seen from the chart above, Darkcoin had tested the support level (marked as the horizontal white line) at least twice before caving in to the extreme selling pressure. Adding to the worries is the fact that the sell-off was well supported by volume (see the last two red candles below the price chart). This indicates that investors have lost faith in the cryptocurrency for the time being and provides an apt opportunity to go short in Darkcoin.
Moving Average Convergence Divergence – The MACD indicator has dug further into the red region and currently reads -0.0008991 while the Signal Line is still relatively less negative at -0.0006931. The Histogram value is also very discouraging (to the bulls) at -0.000495.
With bears at their full strength and bulls on a slippery slope, it is advised that all long positions be exited immediately. Only short positions should be considered at current levels and on any rise until 0.01617BTC is breached on the upside. The primary target on the downside is 0.014BTC while the secondary target is 0.012BTC.
Traders with low-risk appetite may short on rebound until the 20-4h simple moving average is crossed.