Decentraland Elliot Wave Cycle Has an Unfinished 3-Wave Pullback
Decentraland's (MANA) long term Elliott Wave cycle has an unfinished 3-wave pullback that needs to complete before the next bull run. Simply put, the Elliott Waves cycle operates in a five-wave movement in the direction of the trend, followed by a 3 wave movement against the trend.
What is Decentraland (MANA)?
Decentraland is a decentralized virtual world that runs on the Ethereum blockchain.
The world is made up of land parcels that are known as " decentralized applications" (dapps). These dapps can be anything from games to social networks.
Decentraland is powered by the MANA token, which is used to purchase land and other virtual goods.
The Decentraland Elliot Wave Cycle has an unfinished 3-wave pullback, which suggests that the price of MANA is likely to continue to rise in the future.
Elliott Wave Analysis
In the long term, MANA is trading in a five-wave bullish cycle, where the current pullback from the November 2021 peak looks to be just a correction in wave IV.
Typically, waves 4 are countertrend moves that unfold in 3 waves.
The first leg "a" of wave 4 can be called completed at $0.59 low. Wave "b" of wave IV can be right now in progress. Around the $1.50 level – a previous all-time high swing point, wave "b" can find resistance, and the price may turn lower for the final wave "c" to complete the 3 wave pullback in wave IV.
April 2018 peak was another major cyclical high, which is an excellent candidate to become a strong support level before we bottom in wave IV.
However, since in Elliott Wave analysis, wave 4 never overlaps wave 1, we can expect the next MANA leg lower to fall somewhere above the 2018 peak.
What is the Elliot wave Analysis?
The Elliot wave is a form of technical analysis that is used to predict future market movements. It is based on the idea that markets move in cycles, with each cycle having two waves.
The first wave is an upward trend, while the second wave is a downward trend. The Elliot wave theory is used to identify these trends and predicting where the market will go next.
RSI Oscillator
Additionally, the weekly Relative Strength Index (RSI) has broken below the 50 mid-level, which typically occurs when the price pullbacks in wave IV.
Therefore, we can use this signal to call wave IV complete once the weekly RSI breaks above the 50 mid-level.
Looking forward: In the short term, the $1.00 psychological level is the first significant level that the bulls are going to eye.
