MANA price falls by sharp 12%, nearing “opportunity zone” for traders
- MANA price crashed by 12% over the past day owing to broader market cues to trade at $0.4752.
- The long-term price movement of the Decentraland token shows that investors are presently depressed, according to the Wall Street Cheatsheet.
- The MVRV ratio shows that the altcoin is nearly dipping into the “opportunity zone”, which suggests accumulation is likely.
Decentraland (MANA) price has declined by a sharp 12% in the last 24 hours, dragged by the broader market sell-off in the crypto market. As MANA trades at around a two-week low of $0.4752, it is also close to a so-called “opportunity zone” in which traders could start to accumulate the token again, according to on-chain metrics.
Decentraland investors look depressed
The price action of the Metaverse token has been similar to a popular price pattern that dictates the psychology of the market. The Wall Street Cheat Sheet suggests that following capitulation, the price dips once again before initiating a recovery. This phase is referred to as a period of Depression for the investors. One way to put it would be that MANA traders are at an all-time low sentimentally.
Wall Street cheat sheet
Generally, this is met with HODLing or accumulation as investors tend to await a recovery. The chances of accumulation at the moment are higher, looking at the Market Value to Realized Value Ratio (MVRV).
The MVRV ratio is an indicator that is used to assess the average profit or loss of investors who purchase an asset. The 7-day MVRV ratio measures this for investors who purchased an asset in the past week.
For Decentraland, the 7-day MVRV sits at -6.44%, which indicates that investors who purchased MANA in the past week are sitting at 6.44% losses on average.
Historically, MANA price has rebounded after reaching this so-called “opportunity zone” zone. If history were to repeat, investors could stop selling soon and start to accumulate.
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Decentraland MVRV ratio. Source: Santiment
Can MANA price break out?
MANA, which is trading at $0.4752, is hovering above a key support level of $0.4718. The altcoin bounced off this line after falling through the 50-day and 100-day Exponential Moving Average (EMA) caused by the 12% crash that took place in the last 24 hours.
From a technical perspective, a recovery could be a bit difficult as the Relative Strength Index (RSI), a momentum indicator, is sitting in the bearish zone below the neutral line.. This means that MANA could either decline further or remain sideways around $0.4718.
MANA/USD 1-day chart
However, if investors begin accumulation and the price sees recovery, the chances of the bearish thesis being invalidated would increase once MANA price breaches the $0.5125 resistance and heads towards $0.5500.
Author
Aaryamann Shrivastava
FXStreet
Aaryamann Shrivastava is a Cryptocurrency journalist and market analyst with over 1,000 articles under his name. Graduated with an Honours in Journalism, he has been part of the crypto industry for more than a year now.
