Will VeChain (VET) hit $1 in 2022? Let's check out what resistance levels are blocking its way!
Vechain (VET) is a layer-1 smart contract platform that aims to enable transparent information flow of businesses by digitizing all their operations and solving real-world economic problems, mostly when it comes to the supply-chain sector.
Vechain consists of a dual-token economy model with two tokens, namely VET and VTHO.
In this article, the focus will be on the native token, VET. It will be a technical analysis of the token using multiple technical indicators on USDT charts, starting with the weekly.
VET/USDT on a Weekly Chart
Vechain (VET) made a bottom in March 2020, as a result of the ‘Covid-capitulation’. After a steady run up, a new high was made during the summer of the same year.
The Fibonacci levels plotted are measured from that bottom to the top. Two negative extension levels, -.382 and -1, are visible that are crucial.
In November 2020, VET made a higher low, right at the 0.382 level and rallied all the way to the exact negative extension.
A weekly demand zone was formed, and VET rose in value all the way towards the -1 extension level.
That all time high (ATH) marked the top in April 2021 and the token started trending down for the rest of 2021.
The weekly demand zone was tested two times and provided clear support.
At the beginning of 2022, VET again tested this demand zone, and so far, it is still providing the support which is needed.
New to trading? Check out our guide on how to draw support and resistance lines!
Can this be the base where VET can start a new uptrend from?
VET/USDT on a Daily Chart
Here, VET has been trapped in a big range ever since it made the ATH in April 2021.
In November 2021, it seemed like VET was ready to escape from the range, however it only deviated above it for a while. Afterwards, a downtrend began, which is still in action.
But, in confluence with the deviation above the range highs, it’s also highly possible that the opposite from a range high deviation is forming here around the lows.
Markets move towards liquidity zones where many traders can be trapped and liquidity is picked up only to reverse the downtrend.
In order to reverse the trend, Vechain bulls have some work to do. The next resistance is around the 7 cents level, as it was an important low, which failed to hold.
If VET could reclaim that low, bulls can look for the 9-10 cents supply zone. Once 10 cents is reclaimed, you could speak of a true trend reversal.
What is important to note is that the EMA’s (21, 50, 100, 200) are clearly in a downtrend and can be resistance barriers too.
Also, if VET sees a rejection at around 7 cents and continues the downtrend, this possible deviation would be invalidated and 3.5 cents would be the next level of support.
VET/USDT on a 4-Hour Chart
Bullish signs are rising on the chart of Vechain on a lower time frame.
The token made a lower low on January 22. Two days later, that low was taken out and the price started a small rally from that point. The high that was made (0.588$) was flipped into support just a few days ago.
Right now, VET is facing the 200 EMA. It seems like the other EMA’s have been flipped into support. However, the 200 is the one which is clear resistance.
Ever since VET broke down from it on November 18, the level has been acting as a resistance.
If the Vechain bulls manage to reclaim the 200 EMA and it starts acting as support, a true trend reversal could begin.
Possible Future Prices With a Trend Reversal
Keep in mind that searching for higher future prices is highly speculative, especially when a coin is in a downtrend, like VET is right now.
That being said, will history rhyme itself for Vechain in the future?
The .382 Fibonacci level of the 2020 run was, as described above, a really important support level for Vechain. The negative confluence level, -0.382, was a clear target for the run that came after.
So, if VET reclaims the broken 0.382 floor, making these lower prices a deviation, then would it be possible to reach the negative level of confluence, which is above 1$, in the future?
Only time will tell…
Summary
- The weekly chart shows that Vechain has been in a downtrend for a few months. However, it is still inside a bigger range and a really important weekly demand zone.
- The daily chart shows that after the deviation above the range highs in November, the opposite may be playing out here at the range lows. VET has to reclaim a lot of levels in order to be bullish again.
- The 4h chart shows signs of bullish reversal, however the 200 EMA is still suppressing the price and needs to be reclaimed for confirmation.
Keep in mind that the above ideas are solely the writer’s thoughts. Never take anything for granted and always do your own research.
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