MANTRA (OM) Price Recovers After 35% Drop — Eyes Wedge Breakout

Key Takeaways

• MANTRA (OM) fell after its all-time high on Feb. 23.
• The OM price broke down from a parallel channel.
• Is the OM correction over, or will the price break down?
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MANTRA has defied the ongoing crypto market correction, increasing by over 175% between January and February. The bullish momentum peaked on Feb. 23, marking a new all-time high.

However, the trend took a turn afterward. OM fell by 35%, breaking its bullish structure and forming a lower low.

Despite the pullback, a strong bounce is underway, suggesting that the correction may be over. Let’s examine the charts and see what lies ahead.

OM Price Finds Support

The daily time frame chart shows that OM has fallen since its all-time high of $9.11 on Feb. 23. On March 3, the price broke down from an ascending parallel channel that had existed for 37 days.

This signaled the end of the increase, leading to a new bearish trend.

After a 35% decline from the all-time high, MANTRA reached a low of $5.85 before bouncing.

The bounce occurred at a horizontal support area and the 0.5 Fibonacci retracement support level at $6.06. If the decrease is corrective, this level would mark the end of the correction.

However, technical indicators do not show any bullish signs. On the contrary, the Relative Strength Index (RSI) is falling and just crossed below 50.

Similarly, the Moving Average Convergence/Divergence (MACD) is decreasing and has turned negative.

Therefore, the daily time frame does not confirm whether the OM trend is bullish or bearish.

However, the shorter-term six-hour chart suggests a bounce is likely. This is because OM trades inside a descending wedge, which is considered a bullish pattern.

Since MANTRA’s price has nearly reached the end of the wedge, a breakout could occur soon.

If one happens, the main resistance will be $7.85, created by a horizontal and Fibonacci retracement resistance.

Nevertheless, it is worth mentioning that there are no bearish divergences in either the RSI or MACD, making this a weaker signal than it would have been if divergences were present.

Future OM Movement

The weekly time frame OM wave count suggests the entire upward movement may be complete. The wave count shows a completed five-wave upward movement that started in September 2023.

The green sub-wave count indicates that the long-term wave five may be over.

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Furthermore, the weekly RSI has generated a bearish divergence, often signaling that the trend is over. If this is true, the OM price has just started a lengthy correction.

As for the short-term count, the wedge formation indicates the OM price is finishing wave one in a new five-wave downward movement.

If the count is accurate, wave two will lead to the proposed breakout from the wedge, creating a lower high before the decline continues.

A likely level for the entire five-wave decrease to end is at the long-term support of $3.40. As per the long-term count, this would be wave A in a long-term A-B-C correction.

Alternatively, breaking out above the all-time high will invalidate this count and suggest the price will move to new highs. This currently seems unlikely.

Bearish Trend Ahead

The recent price movement suggests MANTRA’s impressive price rise has finally ended.

While a short-term bounce is likely, the OM price might have started an extended bearish trend that will continue for most of the year.