SEI Surges 33% After Falling to Key Support — Price Bounce Shows Strength

Key Takeaways

• Bullish divergence spotted on RSI
• Breakout potential from descending wedge
• Wave (iii) targeting key Fibonacci levels

Sei (SEI) has recently broken below its significant support zone, continuing its downtrend since the $0.73 peak in December.

The price made a quick downward spike below its key horizontal level but bounced and is now retesting its lower boundary.

Signs of consolidation and a 33% wick on the 4-hour chart indicate a potential bullish reversal, but will it manage to maintain the bullish momentum?

SEI Price Analysis

On the 4-hour chart, SEI has completed a corrective W-X-Y structure, with wave (Y) bottoming near $0.20, aligning with the 1.0 Fibonacci retracement level.

This means that the price reverted to its pre-uptrend levels, which were last seen in August of last year.

This area has historically acted as strong support, prompting a noticeable rebound. The Relative Strength Index (RSI) shows bullish divergence, suggesting a potential reversal from oversold conditions.

The price has broken below the descending trendline and dipped below the horizontal support zone. However, it quickly found support and regained $0.23, where it currently sits.

The Fibonacci retracement levels at $0.3168 (0.786 retracement) and $0.3298 serve as immediate resistance zones where price reactions are likely.

Sustaining momentum above these levels could trigger further bullish continuation, with the next significant resistance at $0.4058 (0.618 retracement).

Despite the recovery, SEI remains vulnerable if it fails to hold above $0.20. A drop below this level would invalidate the bullish reversal, signaling the potential for further declines.

However, the current structure suggests an emerging bullish trend as long as support holds.

SEI Price Prediction

On the 1-hour chart, SEI forms an impulsive five-wave structure, indicating the early stages of a bullish trend. Wave (i) marked the initial surge to $0.26, followed by a consolidation in wave (ii), forming a minor symmetrical triangle.

Wave (iii) is currently developing. It targets $0.30, which positions the price inside the descending triangle. 

Wave (v) is expected to extend to $0.31 or potentially above the 0.786 Fib level if bullish momentum continues, with the next target around $0.33.

After completing wave (v), a corrective ABC pattern is likely. It could potentially retrace to the $0.2400-$0.2600 zone, offering re-entry points for bullish setups.

The RSI on the 1-hour chart reflects improving bullish momentum, supporting further upside potential.

However, a failure to maintain support above $0.2400 could lead to a deeper correction.

If SEI sustains its bullish trajectory, the price could eventually target $0.4058, aligning with the 0.618 Fibonacci retracement.

Key Levels to Watch

• Immediate Resistance: $0.3168 (0.786 Fibonacci retracement).
• Key Resistance: $0.3298 (previous support turned resistance).
• Critical Resistance: $0.4058 (0.618 Fibonacci retracement).
• Immediate Support: $0.2400 (psychological support).
• Critical Support: $0.2018 (1.0 Fibonacci retracement).
• Invalidation Zone: Below $0.2018, signaling a bearish continuation.