Dymension (DYM) Price Creates Higher Lows but Struggles to Turn Bullish
DYM Price Creates Higher Lows | Credit: Hameem Sarwar
Key Takeaways
- Dymension (DYM) has created three higher lows since June.
- The DYM price trades inside a symmetrical triangle pattern.
- Will DYM begin a bullish trend reversal, or do new lows await?
The DYM price has performed dismally since its launch, creating an almost immediate downtrend. The decline led to a new all-time low in July. DYM has shown some signs of life since, creating several higher lows.
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Let’s see if the DYM price can build on this momentum and start a bullish trend reversal or if the long-term bearish trend will continue.
DYM Creates Higher Lows
The DYM price has fallen precipitously since its launch in February. The decline culminated with a low of $0.97 in July, which was a decline of 76% since the launch price. DYM regained its footing afterward, creating three successive higher lows.
Since then, the DYM price has traded inside a symmetrical triangle, considered a neutral pattern. However, since the pattern comes after a downward movement, it will be more likely to lead to a breakdown.
Additionally, DYM has followed a descending resistance trend line (dashed) since launch, and the trend line coincided with the triangle last week (black icon).
The Relative Strength Index (RSI) creates higher lows after moving outside its oversold territory. However, the indicator has not generated bullish divergence and is still below 50. So, it is not enough to negate the bearish price action.
Therefore, the weekly time frame leans toward a price breakdown and barish continuation. Let’s look at the daily one and see if it gives any contradicting outlook.
DYM Price Breakdown Ahead
The daily time frame chart does nothing to dissuade the bearish DYM price prediction from the weekly one. The daily wave count suggests the triangle will lead to a breakdown since the DYM price has completed its A-B-C-D-E structure (black).
If the count is accurate, DYM will break down and resume its previous downward movement.
The daily RSI and Moving Average Convergence/Divergence (MACD) are neutral, so the wave count and price action take center stage, making a breakdown more likely.
If a breakdown happens, DYM could fall to $0.61, reaching the 1.27 external Fibonacci retracement of the triangle.
This would represent a new all-time low. Since triangles are often waved four to a higher degree, this could mark the end of the downward movement.
Trend Still Bearish
Even though the DYM price has created several higher lows, the price action and wave count both predict a breakdown that leads to the continuation of the decline and a new DYM all-time low.
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