EOS is trading under a descending trend line on the 1-hour time frame but has yet to test this resistance. The 38.2% Fibonacci retracement level already seems to be keeping gains in check, though, and price could resume the drop to the extension levels.

However, EOS has yet to form new lows to confirm that the retracement is over. A larger pullback could still reach the 9.000 level near the 50% Fib and 200 SMA dynamic inflection point.

Speaking of moving averages, the 100 SMA is safely below the longer-term 200 SMA to signal that the path of least resistance is to the downside. This means that the downtrend is more likely to resume than to reverse. Also, the gap between the moving averages is widening to signal stronger selling momentum.

RSI is also moving south to show that sellers have the upper hand. Stochastic is heading lower but is dipping in oversold territory to reflect bearish exhaustion and a potential return in buying pressure.

Sustained selling pressure could lead to a test of the swing low at the 38.2% extension or the 50% extension at 6.5215. Stronger bearish momentum could lead to a drop to the 61.8% Fib at 6.0487 or the 78.6% level at 5.3755. The full extension is at 4.5181.

The US dollar strengthened across the board on cooling trade tensions as Trump expressed willingness to go through CFIUS approval before slapping restrictions on foreign investments in US companies. However, he also clarified that they are targeting all countries trying to steal US technology and not just China.

Cryptocurrencies are still on weak footing though, possibly drawing another round of selling pressure on Jack Ma’s comments against altcoins. He remarked that blockchain technology has plenty of applications but that bitcoin is likely a bubble.

This adds to the gloomy sentiment in the industry as investors are already wary about recent hacking incidents and rising regulatory oversight, with the latest coming from Japan’s authorities.

The post EOS Price Analysis: Higher Correction or Downtrend Continuation? appeared first on Ethereum World News.