Compound (COMPUSD) Bullish Retracement Comes to an End

Price Analysis: Market Prepares to Trend Bearishly

As Compound (COMPUSD) momentarily surpassed the $81.40 threshold, it encountered substantial resistance, marking a pivotal moment that signaled a shift in market sentiment from bullish to bearish. The ensuing price action was characterized by a pronounced bearish trend, with the asset experiencing a significant decline. This downtrend was indicated by the formation of lower lows, accompanied by heightened bearish volatility as the price breached the support level at $64.70.

COMPUSD Key Levels

Demand Levels: $47.40 $35.20
Supply Levels: $64.70, $81.40

Upon touching the lower boundary of $47.70, Compound experienced a bullish retracement, which saw its price ascend to retest the previously established $64.70 supply zone. This level also coincides with the midway point (0.5) on the Fibonacci retracement scale. Moreover, the daily Relative Strength Index (RSI) has begun to show signs of fading momentum, suggesting that the strength of the retracement may be waning, potentially signaling an end to the bullish correction.

Further insight is provided by the 4-hour chart, where a Head and Shoulders pattern has emerged. This pattern is often interpreted as a precursor to the conclusion of a bullish pullback, with a likely resumption of the bearish trend.

Market Expectation

It is anticipated that the price will decline following the completion of the Head and Shoulders formation. Should this bearish momentum continue, it is forecasted that COMPUSD will breach the $47.40 level, which represents a significant demand zone.

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