COTI Network (COTI) is approaching strong support, what’s next?

COTI Network (COTI) broke out on a long-term descending parallel channel on Aug 25 but was unable to continue its upward trend. The price then went back to confirm it as support.

Although a short-term rally has been initiated, the bullish reversal has yet to be confirmed.

Long term movement

COTI has been trading within a long-term descending parallel channel since hitting its ATH on March 8th. The downtrend peaked on July 20, hitting a low of $ 0.088. COTI then begins an upward trend.

On August 25, COTI managed to break the channel and hit a high of $ 0.49 that same day. The high was created right at the 0.786 fib retracement resistance when the total down move was measured.

Although the token has since fallen, it has found support at $ 0.29 where the price has doubled. This zone also coincides with the resistance line of the channel and the super trend line (green line).

However, MACD and RSI are both neutral and trending down. The former is just above the 0 line while the latter is just above the 50 line.

So while the price trend still looks optimistic, the technical indicators remain undecided.

COTI / USDT daily chart | Source: TradingView

Count waves

The long-term move looks like a potential bullish impulse with five waves (white), with the aforementioned July 20th low marking the bottom of the fourth wave. The low did not break below the trendline connecting the bottom of waves one and two so the formation is still valid.

The potential target for the top of this momentum is $ 0.90. This is the 1.61 external fib retracement level of wave four (black) and coincides with the resistance line of the connected channel between waves one and two.

COTI / USDT 3-day chart | Source: TradingView

Trader @CryptoCapo_ outlined the COTI chart, suggesting that there is a perfect setup for the coin to continue rising as the current decline is a three-wave structure.

The source: Twitter

While the drop (marked area) is a three-wave structure, this is also the subsequent upward movement.

Hence, it is likely waves A and B of the ABC correction structure (black), and COTI is currently in wave C.

A potential area to complete this move would be just below the 0.618 fib retracement support at $ 0.242. This move will sweep the September 7th low (green symbol) and complete the ABC structure.

COTI / USDT daily chart | Source: TradingView

You can see the COTI prices here.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

SN_Nour

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