Steem / USD Technical Analysis: Struggling Against The Pattern
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- Steem is bullish in the short-term, although the MACD indicator is showing bearish divergence on the four-hour time frame
- The medium-term outlook for the cryptocurrency remains bearish despite the recent rally
- Bulls have much work to do to invalidate the bearish head and shoulders pattern on the daily time frame
Steem / USD Short-term price analysis
In the short-term, Steem is bullish after the recent rally in the cryptocurrency triggered a large inverted head and shoulders pattern on the four-hour time frame.
The MACD indicator on the four-hour time frame is showing bearish MACD divergence, which if corrected, would see the STEEM / USD pair falling back under its 200-period moving average on the mentioned time frame.
A downward correction may be nearing as technical indicators are starting to appear overstretched.
STEEM / USD H4 Chart (Source: TradingView)
Pattern Watch
A degree of caution is warranted as the bullish inverted head and shoulders pattern on the four-hour time frame has yet to reach its upside objective.
MACD Indicator
The MACD indicator is currently showing bearish MACD divergence on the four-hour time frame.
Momentum Indicator
The Momentum indicator is turning lower as the recent up move is starting to weaken.
Steem / USD Medium-term price analysis
Steem is bearish in the medium-term, with the recent up move failing to invalidate the large head and shoulders pattern across the daily time frame.
The cryptocurrency is trading well below its 200-day moving average; buyers will need to make significant gains to start to trade back above it. Technical indicators are also starting to approach overbought conditions on the daily time frame.
STEEM / USD Daily Chart (Source: TradingView)
Pattern Watch
Traders should watch the head and shoulders pattern for the potential creation of a right-hand shoulder or eventual invalidation of the bearish pattern.
MACD Indicator
The Momentum indicator on the daily time is still rising with a bullish crossover underway.
RSI Indicator
The Relative Strength Indicator on the mentioned time frame is turning lower after reaching overbought trading conditions.
Conclusion
Steem is bullish in the short-term, although the four-hour time frame is signaling that the latest up move has created large amounts of bearish price divergence. STEEM / USD medium-term outlook is likely to remain bearish until we see the cryptocurrency breaking to fresh 2019 trading highs and invalidating the head and shoulders pattern on the daily time frame.
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