This Content Is Only For Subscribers
GALA Under Pressure: Navigating the Bearish Storm
Welcome back to another edition of The Crypto City Trading Newsletter, your go-to source for in-depth technical analysis and expert insights into the dynamic world of cryptocurrency trading. Today we are focusing on the Daily Chart of GALA.
The technical analysis provides an in-depth look at the GALA. The analysis focuses on identifying key support and resistance levels, recent price movements, and possible future scenarios. By analyzing these factors, traders will gain insight into the current market condition and make better trading decisions.
The chart highlights several key resistance and support zones, each color-coded for clarity. The Monthly Resistance Zone (Blue), positioned between $0.07028 and $0.07365, marks a significant area where the price has repeatedly struggled to break through, indicating strong selling pressure at these levels. Below this, the Daily Resistance Zone (Pink) at $0.04979 – $0.05178 and Daily Resistance zone (Purple) at $0.03423 – $0.03802 respectively, represent additional barriers that the price has been unable to surpass.
On the other hand, the Weekly Resistance Zone (Green), ranging from $0.01975 to $0.02131, has acted as a strong support zone previously but now it has become a resistance zone. Currently, it is consolidating on a $0.01565 level. Beneath this lies the Monthly Support Zone (Yellow), between $0.01163 and $0.01251, which serves as a critical support level. This zone acts as a floor, preventing the price from falling further and potentially attracting buying interest if the price approaches these levels again.
A notable feature of the chart is the Descending channel, which reflects the prevailing bearish sentiment in the market. This channel extending from June 2024 to August 2024, indicates that the price has been making lower highs and lower lows, a clear sign of a downtrend. The price has consistently respected this channel, with any attempts to break above it being met with resistance, further confirming the bearish momentum.
The price of GALA stands at $0.01697, just above the $0.01565 level. The market remains under bearish pressure, with the price failing to break above the descending channel. The proximity of the price to the Monthly Support Zone (Yellow) suggests that this area will be crucial in determining the next significant move. A breakdown below this support could lead to further declines, while a successful defense might initiate a recovery.
Currently at the time of writing the trading volume is at $327.408M, indicating a lack of strong buying interest at the current levels. A significant increase in volume would be necessary to confirm any potential reversal or breakout.
If the price breaks above the descending channel and the Weekly Resistance Zone (Green) could signal a potential reversal, leading to a move toward the Daily Resistance Zones (Pink and Purple). If the price manages to gain momentum, it might eventually challenge the Monthly Resistance Zone (Blue), a key level that would need to be overcome for a sustained bullish trend. Conversely, if the price fails to hold above the $0.01565 level and continues to respect the channel, it could retest the Monthly Support Zone (Yellow). A break below this support could lead to further downside, possibly testing new lows.
Technical Indicators
Based on technical indicators on a daily time frame
The relative Strength Index (RSI) value is at 39.79 (Neutral)
Momentum (10) is at 0.0003 signaling a (Buy)
MACD Level (12, 26) is at -0.00156 signaling (Buy)
Exponential Moving Average (50) 0.02173: (Sell)
Exponential Moving Average (100) 0.02730 : (Sell)
Simple Moving Average (100): 0.02945 (Sell)
Exponential Moving Average (200): 0.03144 (Sell)
Ichimoku Base Line (9, 26, 52, 26): 0.01903 (Neutral)
Volume Weighted Moving Average (20): 0.01698 (Sell)
Hull Moving Average (9): 0.01690 (Buy)
Interpretation
The technical analysis for the GALA/USDT pair on the daily timeframe shows a strong bearish sentiment. The Summary gauge indicates a “Sell” recommendation, supported by 14 sell signals, with the majority of the indicators, especially the Moving Averages, pointing towards a “Strong Sell.” The oscillators are mostly neutral, indicating no extreme market conditions, but they lean towards a slightly bearish outlook. The Moving Averages, including EMAs and SMAs, strongly suggest that the market is in a downtrend, with little sign of reversal in the near term.
Given this analysis, the current market environment suggests that holding would be prudent, as the trend appears to continue downward. Our next move should focus on monitoring the support levels closely for potential buying opportunities if the price shows signs of bottoming out. However, until there’s a clear reversal signal, maintaining a bearish outlook.
Liquidation Heatmap
The GALA Liquidation Heatmap reveals a concentrated area of potential liquidations around the current price levels, highlighting a period of vulnerability for leveraged positions. The chart shows that liquidation levels are densely packed between $0.018 and $0.04, with the price having steadily declined over the past three months. As the price hovers near $0.016, it is in a critical zone where both long and short positions are at risk of liquidation, especially if the price moves sharply. This suggests that the market is highly sensitive, and any significant price fluctuation could trigger a chain reaction of liquidations, further intensifying market volatility. Traders should exercise caution, closely monitor these levels, and manage their trades carefully to mitigate potential risks.
Long-Term Trading Setup
We will buy in parts, we will divide our budget into 3 sections, and allocate for buying at each key support mentioned in the chart.
Here are the numbers where you can buy GALA and take profits for the trade.
Buy 1: $0.01565
Buy 2: $0.01397
Buy 3: $0.01163
At buy, 3 we will go all in because this is the lowest.
TP1: $0.03423
TP2: $0.04979
TP3: $0.07365
Conclusion
The technical analysis for GALA/USDT indicates a predominantly bearish trend, with multiple indicators pointing to continued downward pressure. The price is currently hovering near critical support levels, and the market shows signs of potential volatility, particularly with the dense concentration of liquidation levels around the current price range. Given the ongoing bearish sentiment and the possibility of further declines, it would be wise to approach any trades with caution, focusing on monitoring key support levels for potential buying opportunities. However, unless a clear reversal signal emerges, maintaining a bearish outlook remains prudent, with an emphasis on careful risk management to navigate potential market fluctuations.
Your Essential Trading Newsletter
This detailed analysis provides a comprehensive understanding of the current market structure and potential scenarios. Traders can use these insights to make informed decisions and effectively navigate the market.
Stay tuned to The Crypto City Trading Newsletter for more in-depth analyses, market insights, and expert guidance. As always, we strive to empower you with the knowledge and tools needed to navigate the fast-paced world of cryptocurrency trading. Happy trading!
Thank you for being a valued subscriber. We hope you find our insights helpful and informative. For more detailed analysis and updates, visit our website or follow us on social media.
Warm regards,
The Crypto City Trading Team