Since the ATH on November 25, Decentraland (MANA) has been in a steady downtrend as the bulls continued to defend the $2-$2.3 range.
Now a convincing close above the $2.3 base is needed to confirm the strength of the recent falling wedge (white). If the sell-off continues, MANA would pick itself up from the USD 2.1 (white, striped) support. At the time of going to press, MANA was trading at $2.3689, down 4.7% in the last 24 hours.
MANA Daily Chart
Source: TradingView, MANA/USDT
After a precipitous drop from its longevity milestone, the alt lost more than 70% of its value, hitting its 11-week low on Jan. 22. Since then, MANA has doubled its value before returning from its long-term trendline resistance. Post that, it dropped below crucial price points.
Over the past month, MANA depreciated in a falling wedge on the daily chart. Since the downturn, the alt has struggled to stay above the Bollinger Bands (BB) average. The price has been in a tight phase for the past three weeks. This therefore indicates a possible volatile phase in the coming days.
As of now, the $2.3 mark would be a vital price point for the buyers to step in and prevent a further decline. Volumes have also been declining lately. Hence, a weak bear movement is revealed. If the bulls manage to hold onto the immediate support, the alt would likely continue its low volatility phase before setting a trend.
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Source: TradingView, MANA/USDT
The RSI has weakened significantly in the past month. After forming a descending triangular pattern, the 40-point floor would be crucial for the bulls to defend. A reversal of this figure would keep hopes of recovery alive. Also, the Squeeze Momentum Indicator confirmed the squeeze phase of the past three weeks. This reconfirms the possibility of a volatile period in the coming days.
Conclusion
MANA is really in a tricky area. If the bulls secure the $2.3 base, the chances of a reversal of the falling wedge are high. But a close below this level could trigger a $2.1 retest before a rebound. By the way, the alt shared a 73% 30-day correlation with Bitcoin. So it is crucial to keep an eye on the movement of the king coin in addition to the above analysis.