Key Takeaways
Cronos (CRO) has recently experienced significant volatility, reflected in its sharp price movements across higher and lower time frames.
This analysis delves into the recent trends, Elliott Wave counts, and key technical indicators to provide a comprehensive outlook on CRO’s price dynamics.
The 4-hour chart reveals a descending wedge formation, with CRO completing wave (e) of a larger corrective structure.
This sharp decline brought the price below the 0.786 Fibonacci retracement to a low of $0.083, signaling the potential exhaustion of bearish momentum.
The Relative Strength Index (RSI) exhibits a bullish divergence, indicating that the recent downtrend might be losing strength and setting the stage for a possible reversal.
Price action has consistently shown lower highs and lower lows within the descending triangle, a typical pattern preceding bullish breakouts. However, we saw a bearish one in this case, leading to a 38% decline since Friday.
The convergence of descending trendlines and the RSI rebound from oversold territory suggest that CRO could prepare for an upward move. A 25% recovery followed, and it regained $0.10, where it currently trades.
A breakout above the $0.1065 level, aligned with prior horizontal support, would confirm this bullish bias. The next significant resistance is the 0.618 Fibonacci retracement level at $0.1326.
On the 1-hour chart, CRO displays a clear Elliott Wave structure, with wave (i) and corrective wave (ii) potentially ahead. If a higher low is established on the retracement, there will be a high chance of wave (iii) development.
It could propel CRO towards the $0.1150-$0.1250 range, where overhead resistance from prior trendlines converges if confirmed.
The bullish scenario assumes wave (iii) will extend impulsively, breaking through $0.1065 and targeting the descending wedge’s upper boundary.
A corrective wave (iv) could follow, finding support around $0.1100 before the final wave (v) pushes higher towards $0.1326.
However, failure to sustain above the $0.12 area may invalidate this bullish count, leading to a retest of support at $0.0950 and potentially a fall to $0.0709 if bearish momentum resumes.