Hive Blockchain Loses Key Trendline Amid Bitcoin, Ethereum Pullback: What's Next?

Hive Blockchain Technologies, Ltd HIVE fell below a key trendline late Tuesday morning after bouncing up from the area when the markets first opened.

The decline came amid the cryptocurrency and general markets plunging after Federal Reserve chairman Jerome Powell’s testified before the Senate banking committee and issued a warning that the emergence of the omicron COVID-19 variant is likely to hinder America’s economic recovery.

Following Powell’s comments Bitcoin BTC/USD and Ethereum ETH/USD fell over 3% from their session highs while the SPDR S&P 500 SPY dropped over 1.8% at one point.

After losing the trendline as support, Hive Blockchain temporarily held above a key support level at $3.76 but by midday fell below the area, which confirmed the stock is trading in a downtrend.

See Also: Bitcoin Is Forming A Handle In A Pattern: Where Might It Be Headed Next?

The Hive Blockchain Chart: The downtrend began Nov. 9 when Hive Blockchain topped out at $5.60, just 15 cents shy of the stock’s all-time high. Since the date, Hive Blockchain has made a fairly consistent series of lower highs and lower lows and on Tuesday printed the most recent lower high and lower low.

In its downtrend, Hive Blockchain has formed a falling channel on the daily chart and on Tuesday rejected the upper descending trendline of the channel as resistance. Traders will want to watch to see if Hive Blockchain closes the trading session within the channel. An eventual break from the channel either upwards or downwards on high volume will indicate whether the pattern has been recognized.

The key trendline, which has been propping Hive Blockchain up since Sept. 29, is likely to now act as another resistance level if the stock is unable to regain it quickly. The trendline may also act as the top for the next lower high when Hive Blockchain eventually bounces up on the daily chart.

Hive Blockchain is trading below the eight-day and 21-day exponential moving averages (EMAs), with the eight-day EMA trending below the 21-day, both of which are bearish indicators. The stock is trading above the 50-day simple moving average (SMA), however, and on Tuesday was acting as support for Hive Blockchain.

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• Bulls want to see sideways consolidation on the move lower on low volume and then for big bearish volume to come in and break Hive Blockchain up from the falling channel. There is resistance above at $3.75 and $4.21.
• Bears want to see sustained big bearish volume drop the stock down through the bottom descending trendline of the channel and below the 50-day SMA. Hive Blockchain has support below at $3.41 and $3.15.