Namecoin drops from a high of 2.4 this morning, but retraces back to predictable levels, after applying essential technicals.
Let's take a closer look at the NMC/USD chart below. Today we're going to zoom right into the M5 timeframe, as this will provide a clearer picture concerning what's happening right now.
I've performed the Fibonacci study from the high of today at 2.4 to the low of today at 2.16, a drop of exactly ten percent, although this isn't exactly earth shattering news in the grand scheme of things when it comes to Cryptocurrencies ' Volatility .
As we can see, the fall from 2.4 was initiated from within a Bollinger Squeeze. The candle that began the fall marked in a red ellipse had a long upper wick, and at the same time, we had the Accelerator Oscillator and Awesome Oscillator as red, along with the Stochastics heading down from an oversold position.
If we look at where price stopped at 2.16, there was a very small candle that opened and closed entirely below the lower Bollinger band. In addition, by now, the Stochastic Oscillator was heading upwards with a clear, smooth trajectory. At this point, it would be wise to assume a possible retrace was on it's way.
As we can see, price actually rose to the 38.2% Fibonacci level at 2.25, (circled in white) where it remained for around 25 candles without even moving, eventually dropping to the 23.6% Fib level, at 2.215. Since then, price has been fluctuating between these two Fib levels (23.6% and 38.2%) for the past three hours. With the Awesome Oscillator showing strength for a number of bars now, we may see a rise to 50% later on, however, I expect the ranging to continue for the rest of the day.
