• Decentraland price shows its downtrend is still intact but a minor 18% uptrend seems likely.
  • Transaction data shows that a cluster of underwater investors could prevent MANA from going beyond $3.
  • A breakdown of the $2.20 barrier will invalidate the bullish thesis and potentially trigger a 32% crash to $1.49.

Decentraland price has been on a massive bear trend since its all-time high in late 2021. The collapse of this metaverse token seems to be pausing as MANA trades inside a demand zone. Despite the short-term bearish outlook, a quick uptrend seems likely.

Decentraland price leaves a trail of bloodbath

Decentraland price is stuck trading below a declining trend line for nearly two months and has dropped 50% since its first retest. Although MANA attempted a breakout on January 15, it failed and slid back below it.

As Decentraland price trades inside a $2.20 to $2.88 demand zone, there is still a chance for a minor uptrend. Investors can expect MANA to rally 18% and retest the 100-day Simple Moving Average (SMA) at $3. However, this uptrend could be cut short by the weekly resistance barrier at $2.92.

Any move beyond the $3 mark seems unlikely, mainly because of the current outlook of the market and due to the 50-day SMA at $3.27.

MANA/USDT 1-day chart

MANA/USDT 1-day chart

Supporting this technical perspective of a limited upside is IntoTheBlock’s Global In/Out of the Money (GIOM) model. This on-chain index shows that roughly 31,120 addresses that purchased 488.12 million MANA tokens at an average price of $3.20 are “Out of the Money.”

Therefore any uptrend that pushes Decentraland price to these levels is likely to be met with massive selling pressure from these holders trying to break even.

MANA GIOM

MANA GIOM

Further exemplifying the nature of investors’ sentiment for Decentraland price is the supply of MANA on exchanges. This on-chain indicator shows that the number of MANA tokens held on centralized entities increased by 43 million between December 18, 2021, and January 19.

This spike in the number of investors holding their tokens on exchanges indicates a potential sell-side pressure, supporting the limited upside possibility detailed above.

MANA supply on exchanges

MANA supply on exchanges

Regardless of the short-term bullish outlook, a daily candlestick close below $2.20 will create a lower low and invalidate the optimistic scenario for Decentraland price. This development will trigger a bearish outlook that could see MANA crash by 32% to 1.49.

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Bitcoin Price Prediction: BTC traders in dire need of a realistic price target

Bitcoin Price Prediction: BTC traders in dire need of a realistic price target

Bitcoin (BTC) price has advanced substantially in the first weeks of the year as global markets kept deaf, dumb and blind to the warnings of the central bankers that with the new year, all problems for 2023 will be suddenly erased. Inflation will remain a big topic for 2023, as central bankers might be right that inflation is nowhere near where it needs to be.

More Bitcoin News

Ripple Price Prediction: XRP guaranteed for fourth weekly positive close, but profit target is too far

Ripple Price Prediction: XRP guaranteed for fourth weekly positive close, but profit target is too far

Ripple (XRP) price is set to gain ground above the 200-day Simple Moving Average (SMA) in a repetition pattern as seen last week and the week before, where bulls were able to each time consolidate above a key pivotal or technical level.

More Ripple News

Apecoin Price Prediction: APE bulls are nearing a difficult hurdle that might be too high to jump

Apecoin Price Prediction: APE bulls are nearing a difficult hurdle that might be too high to jump

Apecoin (APE) price is having one of its best weeks for the year as bulls are pushing price action firmly higher. The risk is that with the several central banks coming out next week, some hawkish comments could trigger a massive headwind.

More Apecoin News

Hedera Price Prediction: HBAR missed the opportunity to reach that target before the fade kicked in

Hedera Price Prediction: HBAR missed the opportunity to reach that target before the fade kicked in

Hedera (HBAR) price has been shooting for the starts but looks to be dropping like a stone now. Just like Icarus, who flew too close to the sun, this time, Hedera came just not close enough to the projected price target for this rally.

More Hedera News

Bitcoin: If bulls are back, this is where you can accumulate BTC next

Bitcoin: If bulls are back, this is where you can accumulate BTC next

Bitcoin price shows a lack of momentum after an explosive move in the last three weeks. The fourth week has been relatively silent, without a lot of volatile moves. While BTC consolidates, other altcoins are rallying left and right, providing massive gains.

Read full analysis

BTC

ETH

XRP