The cryptocurrency market shows positive dynamics today, particularly with Ethereum rising about 3%. However, Virtuals Protocol faces important technical analysis levels.
Recovery After Decline
Ethereum (ETH) is currently trading around $2500, positively impacting market sentiment. This has also contributed to the rise of other altcoins, including Virtuals Protocol (VIRTUAL), which surged over 5%. However, according to the chart, VIRTUAL is at a key decision point as it retests a recent breakdown.
Current Situation of Virtuals Protocol
On the 4-hour chart, VIRTUAL recently broke down from a bearish pennant pattern, often signaling a continuation of a prior downtrend. After a sharp decline in late June, the price consolidated in a tightening wedge, forming lower highs and higher lows. Currently, VIRTUAL is retesting the underside of the broken pennant, an area that previously served as support but is now acting as resistance. This level coincides closely with the 100-period moving average, currently around $1.57, making it a key decision zone.
Future for VIRTUAL
At the moment, VIRTUAL hovers around the $1.57 mark, where both the broken trendline and 100 MA converge, creating a strong resistance cluster. A rejection from this zone would confirm the breakdown and likely trigger further downside pressure, with a potential first downside target of $1.41 in the short term. However, if buyers manage to reclaim $1.63, breaking above both the trendline and the 100 MA, this would invalidate the bearish setup and could open the door to a bullish reversal in the short term.
Thus, the current situation in the cryptocurrency market indicates possible changes for both Ethereum and Virtuals Protocol, where monitoring key levels of resistance and support will be crucial.
