Analysis provided by Ashton Fraser, learn more about his trading strategies at Forex Reversal.
Like a lot of the other crypto currencies, we are seeing a similar Bollinger Squeeze occur on Peercoin as well.
Lets take a look at the hourly chart below (click to expand):
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First thing we’ll notice is the price rise that occurred a couple of days ago, from a low of 3.630 to a high of 4.22. These are the points from where I’ve done the Fibonacci study. Since then, look at how price has been slowly squeezed by the Bollinger Bands. The width of the Bands have been getting ever smaller, this cannot and will not go on for much longer. Eventually the bands will break, often bringing with it some whipsaw.
Another important point is how the 38.2% Fib level is holding its ground. Over the past 24 hours, price has barely managed to go beyond this point, and for good reason, as it’s right on a psychological whole number, 4.000. And when you get Fibonacci and such round numbers confluencing at the same point, you’re pretty much guaranteed to notice.
I expect this resistance to hold firm for the rest of the day.