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A pump and a dump - A quick look at HIVE price

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Culgin
@culgin
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A massive pump and a dump of similar magnitude. Now what? I am of course talking about the price of HIVE. HIVE went on a parabolic run and saw its price increased from a recent low of 1500 sats to as high as 12888 sats. A remarkable 750% increase over a span of 4 days as shown in the chart below.

A look at HIVE price

I have refrained from writing about HIVE's price during the run up because I know such a parabolic rise is unsustainable and will eventually need to take a breather. In addition, HIVE's chart is a very "young" one with insufficient historical data for a proper analysis. I usually like to analyze on the bigger time frames, but for HIVE, I have to use the hourly charts for analysis. In any case, at the point of writing, HIVE price has corrected.

As you can see from the chart above, the HIVE price has retraced to the 50% fibonacci retracement level. It is now hanging on to that level and attempting to test the 21 SMA on the 4H chart. I also want to point you to the trendlines in red I drew on the main chart itself and the RSI. Such a pattern is known as the RSI bearish divergence. It is used to signal a loss in buying strength and a tendency for reversal.

I commented in various posts that I would love to capitalize on this pump and sell some of my HIVE to buy it back later at a lower price. However, most of my HIVE are powered up and hence, I couldn't do much. Anyway, when I sell on pumps like this, I will always stagger my trades, i.e. I do not sell everything at one go and I usually divide into 3 or 4 portions to sell. This is simply because you never know when this pump will end. On the chart above, I indicated with blue arrows the 3 points where I would have sold my HIVEs. Those are points where the RSI set a lower high and took a turn down signalling a potential turn in momentum. So largely, I would have sold at the 7000, 10000 and 11500 sats levels.

The 50% fibonacci level

If I have sold some of my HIVE, I would be looking to buy them back when the chance comes. I would have bought back some at the 50% fibonacci retracement level, i.e. now, as it is also in the range of the 21 SMA on the 4H chart. Again, I will split into multiple tranches to buy. Note that this will just be a trade to catch a potential bounce. Unfortunately, I did not get to sell any of my HIVE and hence, I am just sitting on the sidelines now.

The 50% fib retracement level is usually a good entry to catch the next bounce before a ticker slides to lower lows, especially after a parabolic run. The TSLA (Tesla) price chart is a good example. TSLA had a recent parabolic run and I think some of you was probably tracking it previously.

As you can see from the TSLA chart, it too had a RSI bearish divergence and went to the 50% fib retracement level. It then bounced up briefly before making lower lows. I circled the point to enter in red on the chart. Similar things happened to BTC and ETH too. Charts below.

When to buy and hodl?

Usually after such a parabolic move up and down following a RSI bearish divergence, the RSI levels will eventually hit the oversold level. This is the point where I suggest to buy and hodl for the longer-term.

If you are a more conservative investor, I will even recommend you to zoom out to a longer time frame and wait for RSI to be oversold at that time frame. Taking my HIVE analysis as an example, since my analysis was done on the 4H chart, I will want to see a RSI oversold at the daily chart before I add to my long-term hodlings.

I think that what will happen next for HIVE price will be a rebound to maybe the 9300 sats level (yellow arrow in chart below) or the 10000 sats level. After which I think it will eventually find a strong support at the 200 SMA on the 4H chart. It should be around 3500 sats by then and notice how it coincides with the 1.618 fibonacci extension level.

As usual, I am just sharing my thought process and please do not take it as financial advice. Due diligence and research are still required for your own investment. What do you think will happen to HIVE price next? Leave a comment and let me know ๐Ÿ˜

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