Notcoin (NOT) Forms Bullish Divergence, Faces Challenges Ahead

Notcoin (NOT), the Telegram-based tap-to-earn coin, is muddled in a tricky situation. Some weeks back, the cryptocurrency outperformed crypto heavyweights, including Bitcoin (BTC), Ethereum (ETH), and Solana (SOL).

Yet, over the last 30 days, it has struggled to maintain the momentum. NOT trades at $0.013, representing a 27.17% decrease within the last month.

Notcoin Bulls Make Moves to Stop Bears

The 4-hour NOT/USD chart shows the cryptocurrency hitting an oversold point on July 1. BeInCrypto found this after analyzing the Money Flow Index (MFI), a technical tool that measures time and price to determine trading pressure.

When it increases, it means that there is buying pressure. However, a decrease implies selling pressure. Also,  a reading below 20.000 means an asset is oversold, while one above 80 means it is overbought. 

On the date mentioned above, the MFI was 17.42. However, as of this writing, the indicator’s reading is 63.31, even though NOT’s price dropped by 4.88% in the last 24 hours. A situation like this is called a bullish divergence.

It happens when price changes indicate a new low, but there is a boost in capital flow. When this occurs, it means selling pressure is subsiding while buyers are capitalizing on the lower values to buy at discount prices.

Read more: 5 Top Notcoin Wallets in 2024

Notcoin 4-Hour Analysis. Source: TradingView

If buyers eventually take over the market, Notcoin’s price may increase as it did between June 11 and 16. Before that period, as shown above, there was a bullish divergence, after which the price went from $0.014 to $0.020 in less than seven days.

While this does not imply that NOT will replicate the same performance, it indicates a notable price increase may be in the works. This could happen within the next five days if validated, and NOT may reach $0.016.

NOT Price Prediction: Will the Roadblock Prevail?

In the past, Open Interest (OI) was one factor that helped NOT sustain its uptrend. As commonly referred to, OI measures speculative activity in the market. An increase in this indicator implies a rise in liquidity allocated to contracts in the derivatives market

On the other hand, a decrease suggests an increase in closed positions. As of this writing, Notcoin’s Open Interest is $143.08 million. Six days ago, the value was $163.60 million, meaning contracts valued at $20 million had been closed.

Notcoin Open Interest. Source: Santiment

For the price, this decrease implies that the downtrend is getting weak, aligning with the MFI indications. But to reverse to the upside, more money has to come into the derivatives market. If this happens, then NOT to $0.016 will begin its move.

Despite the bullish potential, the Ichimoku Cloud shows that NOT may face resistance as it attempts to erase some of its recent losses. The Ichimoku Cloud is a technical tool that measures momentum while gauging trend direction.

If the cloud is above the price, it means the trend is down. But when prices are above the cloud, it indicates an uptrend. As of this writing, the cloud is above NOT’s price, indicating that the cryptocurrency may face some form of resistance in trying to trade higher.

Read more: Tap-to-Earn: What to Know About the Crypto GameFi Trend

Notcoin 4-Hour Analysis. Source: TradingView

If successful, the NOT price may reach $0.016 or as high as $0.018 in the short term. However, bearish rejection and a further decline in Open Interest could lead the price to $0.011.

The post Notcoin (NOT) Forms Bullish Divergence, Faces Challenges Ahead appeared first on BeInCrypto.