• SafeMoon price dipped below the May 23 swing low to form a new bottom at $0.00000257.
  • A reversion to the mean indicates a 60% upswing.
  • The RSI has dipped below the oversold zone, further strengthening the bounce-back narrative.

SafeMoon price has experienced a massive sell-off since June 15 as it deviated below its previous range low established on May 23. However, this deviation is likely to revert to the mean, providing an excellent opportunity for an uptrend.

SafeMoon price likely to revert to mean

SafeMoon price created a range as it dropped 60% from $0.00000682 to $0.00000257. Since this vast crash, SAFEMOON briefly reverted to the 50% Fibonacci retracement level of this range at $0.00000478.

The inability of the buyers kept SafeMoon price below this level for most of the time. Similar reversion to the mean takes place when a significant price move occurs, regardless of the direction.

The recent sell-off pushed the range low to $0.00000257. AlthoughSafeMoon price has risen 24% over the past 12 hours, more of this ascent is likely to occur shortly.

Therefore, investors can expect SAFEMOON to retest the 50% Fibonacci retracement level at $0.00000470, roughly a 60% rally from the support level at $0.00000295.

SAFEMOON/USDT 4-hour chart

SAFEMOON/USDT 4-hour chart

RSI dips into oversold region

Moreover, crashing 30% between June 20 and June 22 pushed SafeMoon price to create a new range low and dragged the Relative Strength Indicator (RSI) below 30, the oversold level.

The last time RSI dipped below 30 was on May 23, which was followed by an 88% rally, which swaggered through the mean.

Although RSI has climbed to 46, if something similar were to happen, a 60% upswing to the 50% Fibonacci retracement level at $0.00000469 seems likely.

Bitcoin, general cryptocurrency market hints at move higher

The mean reversion theory holds for Bitcoin price as well. Considering the massive correlation that altcoins generally have with BTC, it is likely to assume that a swift move up in the flagship crypto’s market value will likely trigger the altcoins to do the same, including SAFEMOON.

This relation depends mostly on Bitcoin’s dominance, which measures how much of the total cryptocurrency market comprises BTC.

In a nutshell, it is the ratio of the market capitalization of Bitcoin to the altcoins. Generally, a decrease in Bitcoin dominance paves the way for altcoin season, and the opposite makes altcoins heavily correlated with BTC.

Over the past month, the dominance chart has set up two higher highs, indicating a steady growth and further adding credence to the bullish thesis for SAFEMOON.

After the recent sell-off, the flagship cryptocurrency has positioned itself for a move higher; therefore, investors can expect SafeMoon price to do the same as well.

BTC.D 1-day chart

BTC.D 1-day chart

To conclude, the technical perspective indicates that SafeMoon price is likely to head higher. However, the resistance levels at $0.00000338 and $0.00000412 will play a pivotal role in deciding if the rally reaches its intended target at $0.00000470.

Rejection at any of these levels leading to a decisive 4-hour candlestick close below the range low at $0.00000257 will invalidate the bullish thesis.

In this case, SAFEMOON might dip 23% to the immediate support level at $0.00000198.


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.

Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Chainlink social dominance hits six-month peak as LINK extends gains

Chainlink social dominance hits six-month peak as LINK extends gains

Chainlink social dominance surged to a six-month peak on Friday as LINK holders increased their activity. LINK traders started taking profits, on-chain data trackers show. LINK price added 6% on Friday, extending its gains from mid-week.

More Chainlink News

Binance helps Taiwan crack a virtual asset money laundering case, BNB sustains above $570

Binance helps Taiwan crack a virtual asset money laundering case, BNB sustains above $570

Binance’s Financial Crimes Compliance (FCC) department joined forces with Taiwan’s Ministry of Justice and helped resolve a case of money laundering worth NT$200 million, or $6.2 million. 

More Binance News

Bitcoin Weekly Forecast: Is BTC out of the woods? Premium

Bitcoin Weekly Forecast: Is BTC out of the woods?

Bitcoin price shows signs of continuing its uptrend, providing a buying opportunity between $64,580 to $63,095. On-chain metrics forecast a bullish outlook for BTC ahead. If BTC clears $70,000, the chances of resuming the uptrend would skyrocket.

More Bitcoin News

XRP trades steady at $0.50 as Ripple shares plan to expand services in Africa

XRP trades steady at $0.50 as Ripple shares plan to expand services in Africa

Ripple hovers close to $0.51 on Friday, above the psychologically important $0.50 level, as traders await the court ruling of the lawsuit against the US Securities and Exchange Commission and amid new commitments from the firm to expand its services in Africa. 

More Ripple News

Bitcoin: Is BTC out of the woods? Premium

Bitcoin: Is BTC out of the woods?

Bitcoin (BTC) price action in the past two days has confirmed the resumption of the bull run. However, BTC needs to clear a few key hurdles before investors can go all-in. 

Read full analysis

BTC

ETH

XRP