Despite a rapid rally throughout August, the OmiseGo (OMG) price failed to reach a weekly close above a crucial resistance area. It is not yet clear if the trend is still bullish or if the price has begun a correction.
At the beginning of August, OMG began a rapid upward move that took the price to a high of $9.86 on August 21. However, the price was rejected by the 0.382 Fib level of the previous downward move and failed to reach a close above the $7.30 area.
The movement left a long upper wick instead, a sign of selling pressure. This area had previously acted as support for more than a year and has now turned to resistance. The closest support area is found at $2.70.
Technical indicators are slightly bearish. The Stochastic RSI has made a bearish cross, and the MACD and RSI are falling, but there is no bearish divergence present.
Cryptocurrency trader @Pierrecrypt0 outlined an OMG chart, stating that the price could continue increasing towards the range high at $5.20.
A look at the daily chart shows that the price has found support above the 50-day moving average (MA), and has been consolidating above it for the past five days.
In addition, the MACD and Stochastic RSI are moving upwards, the latter possibly getting ready to make a bullish cross. However, the RSI is below 50 and there is no bullish divergence yet.
Still, it seems more likely that the price will bounce towards $5.20, and possibly $5.76, the 0.382 Fib level of the entire decline.
OMG Wave Count
The wave count for OMG is not entirely clear. Initially, it seems that the price has completed a bullish impulsive five-wave formation (shown in blue below) since the fifth wave has already increased by more than 2.61 of waves 1-3 together.
If so, the price has now begun an A-B-C correction (blue), meaning that the previously proposed bounce is the B wave. However, the sub-wave count suggests that the fifth sub-wave has not been created yet (orange), and the proposed bounce is the beginning of the fifth and final sub-wave.
While the count will be clearer once the price action develops, the price should bounce from the current level, either in a B wave or the beginning of a fifth sub-wave.
(Due to the extension of the fifth wave, the logarithmic chart is shown below in order to better visualize the wave movement)
The weekly chart OMG/BTC chart shows a failure to close above the 45,000 satoshi area, which has been a long-term support area. In addition, there is a similarly long upper wick as there is in the USD pair.
Until the price reaches a close above this resistance area, we cannot confidently state that OMG has begun a bullish trend.
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Source: Be In Crypto